It’s been pointed out that George Steinbrenner’s heirs saved about $500 million in estate taxes because of the timing of his death. Unlike every other year since 1916, there is no federal estate tax in 2010. In 2009, the estate tax rate was 45% and next year, without Congressional action, it will be 55%. The one-year tax-free gap is the result of Congress’s refusal in 2001 and again now to make the Bush tax cuts permanent.
Something I haven’t seen pointed out – perhaps because most commentators have better taste than I – is that while fortuitous good timing is always welcome, enormous financial incentives to hasten the death of your wealthy relatives is not a good thing. I’m not saying that the death of four U.S. billionaires in the last five months is tied to the 2010 incentives, but it would be naive to think that the four billionaires and their heirs were unaware of the historic tax advantages of dying this year.
Did their awareness influence how aggressively the four elderly billionaires and their heirs sought medical treatment? We’ll likely never know. But it wouldn’t be the first time the threat of high taxation caused otherwise irrational distortions in decision-making. The fact that such ghoulish distortions are even a possibility is a good reason – among many – for Congress to act sooner rather than later to permanently eliminate or reduce the estate tax.
For more on the other good reasons, see here.
KnightsofMalta
Dan Spencer
Moe Lane
Steve Maley
Dan McLaughlin
Caleb Howe
I know this is in poor taste and a major
throwback59 Wednesday, July 14th at 6:16PM EST (link)exaggeration but I can’t help but think of an expression that came out of the 2004 Tsunami: “The dead are the lucky ones.”
While you may have taste, Curt...
Eric Olsen (Diary) Wednesday, July 14th at 6:17PM EST (link)…it would appear a few of our leftist, confiscatory clowns in the Senate aren’t as fortunate:
“[One billioonaire's] death was cited in a letter last month by three liberal U.S. Senate members calling estate tax reinstatement retroactive to Jan. 1. “”At a time when we have a record-breaking $13 trillion national debt and an unsustainable federal deficit, people who inherit multimillion- and billion-dollar estates must pay their fair share in estate taxes,” said the letter, signed by Sens. Bernard Sanders, I-Vt., Tom Harkin, D-Iowa, and Sheldon Whitehouse, D-R.I.
They have introduced a bill that would put a 65% tax on big estates. Legal scholars debate whether a retroactive imposition of a tax is constitutional, although some past court rulings have upheld such legislative actions if they don’t go back further than the current tax year.”
No taste, and shame at all in their game, no sir.
“I need no warrant for being, and no word of sanction upon my being. I am the warrant and the sanction.” – Ayn Rand, Anthem
God is a Yankee
drfredc Thursday, July 15th at 12:05AM EST (link)God must be a Yankee fan who believes keeping the Yanks in the family is good for the Yanks…
Always, Fred C
I sincerely hope that God is NOT a Yankee
JSobieski (Diary) Thursday, July 15th at 12:41AM EST (link)but I am happy that no inheritance tax is being paid . .. at least at the federal level.
My rules of the road for primary season.
Rule #1: Vote for YOUR first choice in the primaries
Rule #2: Vote for the R in the general.
Rule #3: Don’t let anyone convince you to violate Rule #1 or Rule #2
Rule #4: When in a center-right argument, reaffirm Rules #1-#3–it will help us all to get along better.
Rule #5: If you are using the language of the left, you probably aren’t furthering conservativism
Rule #6: The priority is issues first, candidates second, and supporters third. Nobody is bigger than the issues. Conversely, if you spend your time focusing on supporters, you are wasting everyone’s time.
STOP THE MADNESS!
A reduction in the rate of spending increases is NOT a cut!
In-state tuition for illegals is NOT amnesty!
Requiring someone to pay their medical bills is NOT an individual mandate!
Reducing tax rates is NOT a tax increase!
Good and Bad on the Death Tax
GreyCloak (Diary) Thursday, July 15th at 3:28AM EST (link)… But the fine print says that investments inherited this year will still be taxed at the Capital Gains tax rate, when sold.
Warren Buffett and Bill Gates have both come out FOR the Death Tax, but they are BOTH leaving much of their fortunes to charity, avoiding the Death Tax in ANY year. In Buffett’s case, not only will his contribution be put to better use than the Government could do, but his estate will also avoid giving Congress about $17 Billion with which to play!
Ummmm
melatr7 Thursday, July 15th at 7:29AM EST (link)Did anyone look inside the caskets?
Now that's funny!
pamdale Thursday, July 15th at 8:05AM EST (link)Makes one wonder…