Death Tax Returns

[nnuut]

This one is a KILLER of business in the USA, ask the farmers children.:nuts:

How to cheat the tax man in 2010

By Bob Greene, CNN Contributor
August 15, 2010 8:57 a.m. EDT
Editor's note: CNN Contributor Bob Greene is a best-selling author whose books include "Late Edition: A Love Story (http://us.macmillan.com/lateedition)" and "When We Get to Surf City: A Journey Through America in Pursuit of Rock and Roll, Friendship, and Dreams."
(CNN) -- Want a hot tip about how to make a financial killing this year?
Die.
That's right. It sounds like a distasteful joke, but courtesy of the United States Congress, it's a gruesome reality.
Because of a hiccup in the convoluted tax laws, Americans who have done exceptionally well for themselves during their lives will be able to preserve an enormously greater percentage of their money, and thus be able to pass it on to their heirs, if they die before midnight on December 31.
The federal estate tax, for this calendar year only, is zero percent; at the stroke of midnight on New Year's Eve it immediately goes to a potential 55 percent for people who have managed to build up a considerable nest egg for their families. The 55 percent rate will apply to everything after the first $1 million in assets, if the current law stands. (Congress still has the beat-the-clock option to step in and change the rules for next year, but so far has not.) [more]
http://www.cnn.com/2010/OPINION/08/15/greene.death.taxes/index.html

[Warrenlm]

Actually I think they have until much later to make a change to the law, perhaps to the end of the calendar year of 2011.

I remember hearing some Senator or Representative speak on the chamber's floor. He had a business he was leaving to his children. He was speaking for a estate tax. He said something to the effect that if his children could not figure out how to keep the business viable after his death they don't deserve it.

When the flap about the Yankees arose I was amazed to hear Hannity and others talk about the huge tax that would have been incurred had the owner died next year. Why should I care if his family gets half a billion when they sell the team versus a whole billion.

Pick a threshold, but at some point it's obscene to ask the little guy to care. I got into a debate with a guy who staunchly believed there should be no estate tax. I proposed an alternative. Forfeit everything but a homestead to the Crown. That would help GDP and state Sales Tax receipts a lot. Make that last check bounce. If children can't make it without an inheritance you failed as a parent. :blink:

[crws]

Actually I think they have until much later to make a change to the law, perhaps to the end of the calendar year of 2011.

I remember hearing some Senator or Representative speak on the chamber's floor. He had a business he was leaving to his children. He was speaking for a estate tax. He said something to the effect that if his children could not figure out how to keep the business viable after his death they don't deserve it.

When the flap about the Yankees arose I was amazed to hear Hannity and others talk about the huge tax that would have been incurred had the owner died next year. Why should I care if his family gets half a billion when they sell the team versus a whole billion.

Pick a threshold, but at some point it's obscene to ask the little guy to care. I got into a debate with a guy who staunchly believed there should be no estate tax. I proposed an alternative. Forfeit everything but a homestead to the Crown. That would help GDP and state Sales Tax receipts a lot. Make that last check bounce. If children can't make it without an inheritance you failed as a parent. :blink:

I plan for my estate to consist of my memorabilia and possibly a house.
0 in the bank.
I want to be able to participate in any funding, enterprise, or endowment I contribute.
Cash money is what life insurance is for, the unexpected.

[alevin]

Those ideas only work when the inheritance you're passing along doesn't involve land value as the basis for wealth. ie, farms, ranches, orchards, vinyards. The inheritance tax would force you to sell land and sell enough (or all) so that you wouldn't have a sufficient land base to keep things going in the next generation, esp. if not enough cash (even with insurance) to pay the taxes.

Family operations especially out west where land is dry and naturally less productive without irrigation, generally you need every acre you have, to turn a decent profit (income varies from year to year based on weather and commodity prices), and need to have better than average production and income some years to offset major crop failures or low prices in other years. You lose all or some of the landbase due to tax sales, you fold it up and make a totally different life elsewhere if you can, even if the ranch/farm has been in family for more than 100 years. that's not the kid's fault they couldn't make a go of it. got to have sufficient acreage, there's a reason why 40 acres and mule didn't work out west and they changed it to 640 acres minimum plus 5 years prove-up.

[nnuut]

Estate tax could threaten small business, farms

Estate tax could threaten small business, farms (http://www.globegazette.com/news/local/article_40019f42-8fd0-11df-9d98-001cc4c002e0.html) By LAURA BIRD, laura.bird@globegazette.com (http://www.globegazette.com/search/?l=50&sd=desc&s=start_time&f=html&byline=By LAURA BIRD, laura.bird@globegazette.com)Globe Gazette | Posted: Thursday, July 15, 2010 12:14 am


http://bloximages.chicago2.vip.townnews.com/globegazette.com/content/tncms/assets/editorial/4/b1/994/4b199410-8fd1-11df-8b88-001cc4c002e0-revisions/4c3e9ba465e98.preview-300.jpg (http://bloximages.chicago2.vip.townnews.com/globegazette.com/content/tncms/assets/editorial/4/b1/994/4b199410-8fd1-11df-8b88-001cc4c002e0-revisions/4c3e9ba461849.image.jpg)msc Steve, Eugene and Charles Sukup of Sukup Manufacturing Co.

SHEFFIELD — Eugene Sukup, 81, founder and owner of Sukup Manufacturing Co., Sheffield, doesn’t plan on dying anytime soon.
However, he can’t help but worry about what will happen to his 48-year-old business should he go anytime after 2010.
“It’s a concern to us,” he said. “There’s no doubt about it.”
The federal estate tax — what some call the “death tax” — is what Sukup worries about.
Legislators have increased the exemption amount over the last several years and rolled back the tax rate until the tax was non-existent this year.
However it’s scheduled to revert to a $1 million exemption for individuals and a 55 percent tax rate in 2011.
That means beneficiaries of estates worth more than $1 million will have to pay 55 percent in federal taxes on the value of the estate over $1 million.
It would cost Sukup Manufacturing Co. millions of dollars.
“It will put the company out of business,” Sukup said. “That means the government is going to end up with about 60 percent of the company. They can’t afford to pay that when I pass away.”
If the company goes, so do 500 jobs.
“You take a little town like Sheffield that has 1,000 people in it and then you’ve got 500 people looking for work?” Sukup said. “It’s going to be a terrible blow if the company would fold.”
Sukup said it’s also unfair because it’s his two sons, not him, who have expanded the company in recent years.
“I’ve got two sons in the business that have grown the company 500 percent in the last 10 years,” he said.
Sukup said he could buy life insurance that would pay the estate tax when he dies, but it’s costly.
“If you’re spending your money for life insurance you can’t expand your company or add employees,” he said.
Another option is trust funds, but those take quite a bit of advanced planning to be successful, said Hampton attorney Brian Miller, who does estate planning.
“Right here, right now it’s probably too late,” he said.
If the tax goes into effect in 2011 as planned it could affect a lot of North Iowans — especially farmers, Miller said.
“It doesn’t take much farm land to add up,” he said. “That’s going to a huge problem for those people that have had farms in their family for 40 to 50 years. Some of it will have to be sold to pay that tax.”
That’s one of the reasons why U.S. Rep. Tom Latham, R-Iowa, is against an estate tax.
“The estate tax — better termed the death tax — is a fundamentally unfair and immoral form of double taxation,” he said. “As a family farmer and small businessman, I have seen firsthand how the death tax has punished Iowa businesses and farms, making it more difficult to pass along a family-grown business from one generation to the next. The death tax is a threat to common sense and the ideal of the American Dream.”[more]
http://www.globegazette.com/news/local/article_40019f42-8fd0-11df-9d98-001cc4c002e0.html

[nnuut]

Kill the Death Tax

The outdated death tax has been found to destroy roughly 1.5 million jobs. It impacts thousands of family business owners, and costs America’s economy billions in valuable capital.


The articles below explain how permanent estate tax repeal will help family business owners recover, create new jobs, and restart America’s economy.


The Death Tax:


Destroys Jobs and Economic Growth

(http://www.tsptalk.com/mb/#destroy)
Ruins Family Business Owners and Farmers

(http://www.tsptalk.com/mb/#family)
Redistributes Private Property

(http://www.tsptalk.com/mb/#redistribute)
Handicaps America

(http://www.tsptalk.com/mb/#handicap)
Punishes Those Who Save and Invest

(http://www.tsptalk.com/mb/#punish)
Impedes Upward Mobility

(http://www.tsptalk.com/mb/#impede)
Is Double Taxation
(http://www.tsptalk.com/mb/#double)
[more]
http://www.nodeathtax.org/deathtax/killthedeathtax

[nnuut]

I really don't agree with the government inheriting personal wealth of the citizens because they died. Isn't there another way that they can take more?:o
[/URL]

Posted by Chuck Collins (http://blogs.alternet.org/speakeasy/2010/06/24/finally-a-progressive-estate-tax-introduced/) at 9:02 am
June 24, 2010

Finally, A Progressive Estate Tax Introduced


Posted by Chuck Collins (http://blogs.alternet.org/speakeasy/author/chuckcollins/) on @ 9:02 am
Article printed from speakeasy: [URL]http://blogs.alternet.org/speakeasy
URL to article: http://blogs.alternet.org/speakeasy/2010/06/24/finally-a-progressive-estate-tax-introduced/

Senate Progressives Introduce Responsible Estate Tax Act
Would you trust Senators Max Baucus and Blanche Lincoln to design the next estate tax, our country’s only levy on inherited wealth?
Unless progressives stand up, Baucus and Lincoln will team up with the GOP’s anti-tax point person, Senator John Kyl, to push through a bad estate tax reform. The Kyl-Lincoln reform proposal would gut the law and give additional tax breaks to multi-millionaires and billionaires.
Fortunately, Senate progressives have just introduced an estate tax reform with some spine. The Responsible Estate Tax Act (S.3533) proposes graduated rates on larger estates, closes loopholes, exempts farms and small businesses, and encourages conservation easements. It imposes a “billionaire surcharge” rate of 65 percent on estates over $500 million.
Led by Senator Bernard Sanders (I-VT) and joined by Sherrod Brown (D-OH), Tom Harkin (D-IA) and Sheldon Whitehouse (D-RI), this progressive estate tax would raise at least $264 billon over ten years. “At a time when we have a record-breaking $13 trillion national debt and a growing gap between the very rich and everyone else, people who inherit multi-million and billion dollar estates must not be allowed to avoid paying their fair share in estate taxes,” said Senator Sanders in a prepared statement.

[Warrenlm]

Probably more passable, but still not revenue producing enough for me.

I can play progressive.
Business privately held. Value $5 million. Sons inherit. Sell company for $5 million. Business continues, jobs continue. Pay $2.5 million tax. Become employees of new owners or sail the Atlantic or both.
What we are debating is whether father can leave his business as a legacy to sons as privately held. We are not risking employment.
Farm privately held. Value of land and operations $5 million. Sons inherit. Homestead area and improvements exempt. Reduced death tax on remainder if sons manage as before for 10 years. Public good to support farmers. Otherwise, sell and pay tax. Business and production continue.
Any argument that business operations cease has to accept that the business is not of value to anyone else. Those don’t last long.
This revenue production is fun.

[Viva_La_Migra]

Probably more passable, but still not revenue producing enough for me.

I can play progressive.
Business privately held. Value $5 million. Sons inherit. Sell company for $5 million. Business continues, jobs continue. Pay $2.5 million tax. Become employees of new owners or sail the Atlantic or both.
What we are debating is whether father can leave his business as a legacy to sons as privately held. We are not risking employment.
Farm privately held. Value of land and operations $5 million. Sons inherit. Homestead area and improvements exempt. Reduced death tax on remainder if sons manage as before for 10 years. Public good to support farmers. Otherwise, sell and pay tax. Business and production continue.
Any argument that business operations cease has to accept that the business is not of value to anyone else. Those don’t last long.
This revenue production is fun.
Not much progress here. Sounds like despotism to me.

[Birchtree]

If you pass on stock the heir benefits from the step up in basis strategy - the heir has to sell the stock to generate a tax consequence. But all the past growth is passed on tax free. Another reason to invest in risk assets my friends. That's how big money survives from generation to generation - live on the income produced from dividends. At least that's my plan.