Explain the logic of the estate tax.

[GSLevel9]

Just curious and I'm open minded on the topic.

I strongly support fair taxation. I have no problem with Clinton era income taxes and maybe a even a bit more. I believe that a fair tax is the price for living in an environment that allows you to amass your personal fortune.

Having said that...

If a man or woman starts a small business, let's say a Dry Cleaning Shop... and every few years they expand and open a new store. After 40-50 years they have a 20 stores valued at 500k each. For 40-50 years they have paid fair taxes on every penny of their income, they've paid witholding taxes for employees and workers comp. They've provided health insurance for employees and have been model citizens in their community.

They have built a 10 million dollar "empire" for their heirs. Upon their death, what right does a government have to take the fruit of this families hard work?

If you've already paid taxes on income... and you put that income in the bank... how can it be taxed again after they pass on?

I know that some will say "the value of the estate" as it is passed to an heir should be considered "income". I don't think that's right and I believe it's all the product of the greed of the government pig. I think the estate tax is wrong... and I see nothing wrong with 50% marginal rates on income.

[oldhippie]

1. It's a way to take wealth from the rich .....

... and re-distribute it to us for things we want or like. Isn't that what we're all about? What more logic do you need?

[niceypoo]

46. I thought all the redistribution went the other way...

...up to the rich. That is why the economy collapsed. So much money was redistributed to the rich in the 2000's that there was none left, a money vacuum. Now we are supposed to feel sorry for them and shovel them even MORE money?

[SharonAnn]

52. Much of the wealth in estates has never been taxed. It's from appreciation.

When the income transfers, then it is taxed.

Just like wages, they're taxed when the person receives the wages.

Just like capital gains, they're taxed when the investor realizes them.

Just like dividends, they're taxed when the person receives them.

Remember, the value of most estates is from appreciation and NEVER has been taxed.
Then when it transfers, it's taxable. It was tax sheltered before that.

[alfredo]

60. It was to prevent a permanent ruling class like they

had in England. They also understood the destabilizing effect of an unfair distribution of wealth.

The tax also encouraged philanthropy.

[RandomThoughts]

2. Lots of arguments on that.

First off the people say they earned the money, that is the idea within the system of how you make money, and the concept you mention is an example of that.

However there children did not earn it, and society has a obligation to all in society. So they should be able to give some to their children, but some should be taken by society to correct the error of imbalance of wages caused by capitalism.

And far worse now, since it is also monopoly capitalism by collusion or cabal.

So because the system sends money to the top out of proportion to actual work done, and because society should see a child born in poverty equal to someone born in wealth. Society should help correct the flaws in the society.


Complete fairness would be no inheritance at all, but that takes the right for a parent to share with children things they saved up over life. So some estate tax makes sense, and some inheritance makes sense.

Basically estate tax should break up consolidations from imbalance of distribution.

[GSLevel9]

10. well written and clear, thanks.

But it still doesn't address the core issue. If I earn a post-taxation dollar, is it really mine? Do I have complete control of that dollar? Or am I holding that dollar temporarily? Because if something is REALLY MINE then I can do what I please with it.

Let's say I won the Mega Millions last night... and I want to buy a Picasso painting.

I go and spend 100 million dollars of my post-taxation money on a painting. It hangs on the wall in my house, I like it. I want it to remain in my house to be enjoyed by all the future generations of "Smith's"...

That painting is MINE. I may do with it as I please. I can throw it in the fireplace in a drunken stupor, I can allow my granddaughter to fingerpaint on it.

SO after my death, does my control over it also die?

It's kind of like saying "All material wealth belongs to the state, certain individuals temporarily hold the wealth but all wealth must revert to the state."

Our constitutional principles are built around the concept of private property and ownership, I can't support an estate tax as it's an attack on the definition of private property.

[HuckleB]

22. If you sell the painting, you will pay taxes on the profits, right?

Further, the money is being transferred to someone else. A parent can only give so much to a child while the parent is alive, without that child having to pay taxes, as well. If income is not taxed in certain cases, the ways to abuse the system, especially for those with means, would be inordinately high.

http://www.avvo.com/legal-answers/how-much-money-can-a-parent-give-a-child-each-year-53757.html

[muriel_volestrangler]

31. "after my death, does my control over it also die?" Yes

Because you're dead. You can write a will, and the law says your executors should fulfil the will, but it is challengable in courts - ie it is not just under the control of the last instruction you gave before you died.

Remember, a dead person does not have rights. There's no constitutional problem at all with the estate tax. It's no more a problem than an import duty. And it is not saying that "all wealth must revert to the state"; it's saying that it is a class of wealth that is taxable - just as personal income is taxable. The existence of income tax doesn't mean "all income must revert to the state".

The point of an estate tax is that it is a progressive tax - that is, it takes taxes more from sources that can afford to pay without causing hardship. It also has a beneficial side effect on societies of slowing the excessive build-up of wealth within families; but, given your "constitution or nothing" approach, I don't expect you'll accept that as any reason for it at all.

[hfojvt]

43. the other part is that much of the wealth is not already taxed

for example, you mentioned a painting. Those, especially the expensive ones, can increase in value. Here is an example of some Rembrandt etchings.

http://rembrandt.parkwestgallery.com/value-rembrandt-copper-etchings/market-prices.html

1967 price went from $45,000 to $173,000 by 1993 in one example and from $20,000 to $396,328 in 2006 in another example.

Taxes were presumably paid on the original $45,000 or $20,000 but they have never been paid on the current value. So some $370,000 would be passed from parent to child without ever having taxes paid on it.

The same is true of that business empire that you imagine. Particularly with a corporation. You start a business with some money, but then the value of that business grows over time. 5 years ago Wal-mart was selling for $45 a share and it is now at about $54 per share. Each Walton kid owns about 250 million shares. Thus in five years, their wealth has increased by over $2.25 billion each.

That $2.25 billion has never been taxed. (a total of over $11 billion because there are 5 Walton heirs).

You might say that it will be taxed if the person who inherits it sells it for a gain, but what is the cost basis then? Is the tax based on the $54 a share it was worth when I inherited it, or on the $20 a share it was worth when my mom inherited it? usually it is based on the value when a person receives it, which would make that $34 a share into tax free income/wealth.

[RandomThoughts]

49. It has been explained before that much of what is income.

It is not saying all material wealth belongs to the state, it is saying income above the work actually done is an error of distribution and belongs to the people that did the work, the state is only an advocate for the people to correct that error.

On a side note, there are many people that say all money is distributed by the divine as an argument for why people have things, that is without reason to make that argument, as would saying the state owns everything.

I say the person with wealth that is more then the work they do, can not justify that money as theres, it is only theres due to an arbitrary distribution system.


Some teach that the constitution is built around private property, it also built around concept that the system has errors 'more perfect union' and concepts that the state has some role in correcting those faults in the systems. 'provide for the general welfare and common defense'

You said the Constitution is built around private property, but you don't make any argument for that, estate tax is a correction to the removal of private property from workers by an imbalanced system.

Does a thief have claim to property after he steals it? There are laws to correct imbalances like theft, in the same way distribution that can not be argued as an accurate representation of what is actually earned should be corrected by progressive taxation and things like estate tax.

If nothing else, it can be shown that consolidations of wealth lead to problems, and that the form of monopoly capitalism in many places, without taxation leads to those consolidations.


The problem is people take joy in expanding what they think is a sign of worth, something like wealth is part of that for most people. Fighting against taxes is just another way for them to 'try to make money' it is part of the game they like to do, not about an argument if it is a correct way to see things or do things. Should be best for people to take enjoyment in successes including money, but then realize it is not about the money and return that because of the flaws in the system. Or as many with much money do, cheat to show you can make money, as some from of a success, then give the stolen money back since a person should know they never really earned it. If a person takes pleasure in earning or creating money for themselves, they should acknowledge they never really earned it. They also can not say distribution was in correct form when out of balance of work done. The self worth is not in the counting of the horde, but can be about earning some money as a challenge. The problem is when that is all they see, so can't understand the concept of taxation.

In truth, most capitalistic profit is taxation off of a workers work, just in a different governance form. Investment is a loan of money for money to make money, then a pay back of interest or dividend from a worker, that is no different then a tax. Social government gives some system for a person to do some investment in, then collects back some of that in taxes.

You probably never really thought about what taxes are outside of the game of most of the making as much money as possible, or the concept that it is mine mine.

[rfranklin]

3. There are ways to transfer your "empire" with minimal taxes...

Your natural inclination to give your children a share in the family business may not only benefit them, but also significantly reduce transfer taxes on your estate. With proper planning, you can shift the opportunity to earn income or gain wealth from yourself to a child without triggering transfer taxes. Some ways to do this are:

■Formation of a limited partnership – to insure that all family members receive equal equity shares, but with control vested in the hands of the operating heir. A possible way to avoid family conflict is to transfer the property to the new operator(s) by means of sale during the father’s lifetime.
■Creating multiple family businesses – rather than having children remain in the family business, you may want to have them set up a complementary or even competing business. Complimentary businesses may provide additional services to your customers. A child in a competing business may take some business away from you – and away from transfer taxes.
■Establish Irrevocable Trusts – a way to maintain control when shifting ownership. Using a irrevocable trust may provide creditor protection to the trust beneficiaries. When transferring a business opportunity that may quickly appreciate in value, an irrevocable trust can provide a number of advantages.
■Business-continuation agreement – an option that can be changed only by action of all the participants. This is a key consideration where the head of the family may be tempted to change his mind in later years, or where some of the heirs decide later they aren’t interested in keeping the operation in tack.
In having a plan in place, a realistic assessment of the business’s future and all contingencies down in writing, you can ensure the prevention of the kind of situation where operating heirs are forced to sell the business to pay estate taxes and attorney fees.

http://www.enterprisebank.com/Products/Business_Products/itemid/81/Business-Transfer.aspx

[PBS Poll-435]

4. Income is irrelevant regarding the estate tax, imho

Let's take Mamma & Pappa Bear's first dry cleaning store.

The borrowed from a bank to finance the property and the building. The note was for $35,000 in 1970. They wrote off the interest to the bank.

Now, today, that property is worth $375,000. Did they ever pay federal tax on the appreciation?

[Cassandra]

5. There are not so many small businesses that do that well...

and then they are a large business. If they are incorporated, I'm not sure what happens to the estate tax, but the taxes are paid out of what the beneficiaries (who may or may not have contributed to the business) receive.
Most estate taxes are levied against previously untaxed and unrealized capital gains on real estate, fine art, jewelry, stocks and bonds. If they are not taxed at the estate level, when will they be taxed?
I say this as someone who has been a beneficiary and will be again.

[GSLevel9]

15. great points.

So if I inherit an Aspen villa valued at 5 million dollars... and I sell it as an heir, will I be charged a capital gains on the sale? If the answer is YES, then I agree. However if the estate is charged an estate tax on the 5 million dollar value, how can I be charged capital gains taxes on top of it as an heir?

[Cassandra]

32. If you inherit the villa...

it will be appraised and the estate or you, depending on how the will is written, will pay inheritance taxes on the value. I think you may only be taxed on the increase in value from the initial purchase price. You wouldn't get taxed double on the property, only once, but the tax would be on the capital gain or loss (I think). OTOH, if you sell immediately, you'd be paying on the market value rather than the appraised value.
My dad's apartment was bought for more than it is currently worth, so if he went now, the value would be lower number.

[northzax]

37. your basis is the last time the property transferred hands

and was taxed. that's if you sell. basically, grandpa's house (or in my case, grandpa's stock) is assessed for my sale purposes at the value on the date of his death. this is different, by the way, from a gift, where you inherit both the holding period (short or long term) and the original cost basis.

example. before his death, my grandfather gave me let's say $10,000 worth of stock in company X. I sell it and my capital gains are based on what he acquired it for. if he leaves it to me in his will after death, my capital gains are based on the value on the day of his death.

[dpibel]

36. No, you won't

Thanks for bringing up the perfect example, stated in different form in #4 in this thread.

Inherited real estate and personal property get what is called a "stepped up basis." The basis is the baseline value against which capital gains are calculated.

You may sell your villa forthwith for $5 million and pay no capital gains at all.

What you didn't add in your hypothetical was the amount the decedent paid for the villa. Let's say he or she bought it 40 years ago. Likely price would be six figures, not seven. They weren't taxed on the change in value. Since you inherit with a stepped-up basis, you won't be taxed.

Any reason you can express that the $4 million plus of actual capital gains, realized when you sell, should not be taxed?

[Sal Minella]

6. Based on the premise of "You can't take it with you,"

an estate, by being inherited, becomes "income" for the next generation, and should be taxed as income.

The son does not necessarily deserve the benefits of the hard work and pecuniary habits of his father, any more than a child deserves to serve out a prison sentence passed on a parent.

Money cycles all the time and it's taxed again and again as it circulates* -- it does not stop being taxable just because it's been heaped up somewhere by a rich man. When money changes hands (by death, by commerce, whatever) it needs to be taxed to provide the wherewithal to keep infrastructures running (fire departments, schools, hospitals, libraries).

I can understand why a rich person says "Mine mine mine" and does not want any portion of his beloved wealth used to pay taxes when the bulk of it is passed down a generation, but I believe it was Thomas Jefferson himself who cautioned against letting too much wealth become accumulated in the hands of too few persons.

I'm sure Jefferson would be horrified at the rich/poor abyss we have at present.

The best way to avoid paying estate tax would be
(a) figure out a way to take it with you or
(b) don't go.

[slackmaster]

7. It's a way of preventing people getting large sums of money that they didn't earn...

...by giving it to other people who also didn't earn it, who keep some of it for themselves and pass the rest on to more people who didn't earn it.

[dpibel]

39. "Other people who also didn't earn it"

You mean the 50 to 70 cents of each of those tax dollars that goes into the maw of the military industrial complex, I assume. Couldn't agree with you more. They don't earn it.

[slackmaster]

41. Thank you. I see much of federal military spending as pissing money down a rat hole.

Pardon my garbled metaphors, but a lot of what the federal machine spends money on does more harm than good.

[fascisthunter]

8. To Keep Aristocracy at Bay

since tax cut after tax cut, we now see an aristocracy, kids who were born into wealth without a clue as to what the rest of us go through on a daily basis. The isolation of rich from poor has also attributed to this detriment.

Now we have rich kids growing up, running our government with little interest in fighting for those without money. The disconnect is real and it is a big problem.

You make as much as you want, but when you die you give it back so others in your country can prosper, since the commons we all pay for have been utilized more by the rich. Pay it back....

[crazylikafox]

38. +1000

[TBF]

9. "Greed of the Government Pig"? Is that what I'm reading?

Why am I reading this on DU?

[GSLevel9]

13. that would be the government PIG that spends Trillions on WAR.

believe me... the government spends money like a famished PIG.

[niceypoo]

47. You are making GOP arguments

Why?

[napi21]

11. I can tell you how a tax accountant explained it to me once.

All money is considered "income". Wether it's earned, found, gifted, won, or inherited. Different types of income are taxed at different rates (ie: interest, Capital Gaines, etc.) but it's ALL considered income if it's "new money to you".

The subject came up while we were discussing a guy who bought an old house and was remodeling it. During he process, the guy found $350,000 in cash hidden in one of the walls. I was arguing with the tax acct. that it was unfair for the IRS to demand he pay axes on it, but I was wrong...as usual.

There is something else you should keep in mind when you think about estate taxes. 1st. At present, no FederalTaxes are due on any amount under $10 million. 2nd. There are hundreds of ways a good tax accountant can divert the money, like trusts etc. that most i not all estate taxes can be avoided sin all but the extremely wealthy, like the Walmart family, and even their estate taxes will be minimal through utilization of the many loopholes in our tax system.

[dipsydoodle]

12. In the UK

I think its based on the fact that because capital gains tax is not payable on the main residence estate tax / death duties helps equalise that by way of tax. Something like that anyway. It follows that the alternative to death duties would be pay-as-go on capital gains even if just debited to a suspense account until an individual died and the account then cleared from sale of the property.

[denverbill]

14. Here what the internet says.

In 1916 Congress for the first time levied a tax upon the transfer of a decedent's net estate. The Committee on Ways and Means of the U.S. House of Representatives explained that a new type of tax was needed, because the "consumption taxes" in effect at that time bore most heavily upon those least able to pay them. The Committee further explained that the revenue system should be more evenly and equitably balanced and "a larger portion of our necessary revenues collected from the incomes and inheritances of those deriving the most benefit and protection from the Government."

Read more: http://wiki.answers.com/Q/When_did_the_inheritance_tax_start#ixzz1ABcsiO17

Just a way to raise money. Better to tax dead rich people than living poor people.

[Warren DeMontague]

16. Everybody hates Paris Hilton. What more logic do you need?

Honestly, I think it's like everything else pertaining to taxes and government; you have hard-staked ideological purist positions on both sides that don't translate well into reality, and then you have practical applications that don't satisfy the idealists but are realistic.

The realistic answer is, it's legitimate to tax "estates" of, say, 10 million simply because it's a very large potential revenue source for the government, and since we're not going to adopt sane policies like cutting the military budget, ending the drug war, or legalizing and taxing marijuana any time soon, we need money. And taxing the transfer of huge estates is one way to boost that revenue.

That said, the exemption needs to be raised, because when you're talking about a one million exemption, you end up with property owners in places like California or New York facing potentially having to sell the family home to pay the estate taxes on it.

So, in short, what is the logic and/or justification? The justification is that you're talking about large sums of wealth accumulated under a system that, fairly or unfairly, tends to favor people with large sums of wealth to begin with. I think some estate taxation is justified, the question is what percentage and what exemption.

[GSLevel9]

20. best post of the thread nt

[Zoeisright]

17. It's the inheritors who are paying the tax, not the deceased.

So it isn't a double tax.

And you really think the Walton kids should be able to inherit the billions they did NOTHING to earn just because their dad died?

[laconicsax]

18. If your hypothetical dry cleaning magnate wants their 'heirs' to take over the family empire...

why not transfer ownership before they die? Make the kids partners and transfer control before ma or pa kicks the bucket.

Inheritance is unearned income and should be taxed accordingly.

[truebrit71]

27. Exactly. I can think of no-one that builds up an 'empire' of $10 mill that hasn't figured out a way

to minimize any sort of tax bite due to death..

[Name removed]

19. Deleted message

Message removed by moderator. Click here to review the message board rules.

[Democrats_win]

21. In 2011 it's simple: THEY owe the money to help US pay China.

You could look at the logic closer. The U.S. borrows money to pay for Bush's wars. These wars helped "protect" the rich and helped the rich become directly or indirectly richer through government contracts. The best point to collect the DEBT owed by the rich is when they die. In 2011 it is common sense and a matter of paying what they in fact OWE!

[SouthernLiberal]

23. Money is not taxed - the transfer of money is taxed

If you hold onto money after paying tax on it, you are not taxed again. When you spend (transfer) that money, you pay taxes. If you use it to pay (transfer to) employees, they pay income tax, even though you have already paid taxes. Some transfers of money are exempt from taxation. If you give money to a charitable organization, you may not have to pay taxes on that money.

If you use any of the methods in response #3 to transfer income to your heirs, you may be able to avoid taxation on those transfers.

As to your response #10, and the Picasso. When you die, you no longer have any control of anything. If you wanted to be buried near your parents, and your surviving heirs decide to have you cremated and your ashes spread over Disneyland, guess what will happen. You have some limited control by your will. But even that may not be enough. If your kids are willing to forgo the money (and the Picasso), you're going to Disneyland! Once you transfer the painting to your heirs, you do lose control of it. You might have wanted it to hang on the wall in your house forever. The kids may not want to pay the insurance, and give it to a museum (for a big tax deduction, no doubt).

Inheritance is a transfer. And it is that transfer that is taxed by the Inheritance Tax.

If you want to make an argument that inheritance should be, like charitable donations, a non-taxable transfer, we can have a discussion.

But by claiming that the Inheritance Tax somehow damages your property rights is not a reasonable argument, since the tax is only due when the property in question becomes someone else's.

[GSLevel9]

26. another great thought provoking post... nt

[Kaleva]

58. +1

[MilesColtrane]

24. It's so self evident, I'll let a Republican explain it.

A heavy progressive tax upon a very large fortune is in no way... a tax upon thrift or industry as a like would be on a small fortune.

No advantage comes either to the country as a whole or to the individuals inheriting the money by permitting the transmission in their entirety of the enormous fortunes which would be affected by such a tax; and as an incident to its function of revenue raising, such a tax would help to preserve a measurable equality of opportunity for the people of the generations growing to manhood.

...proposals for legislation such as this herein advocated are directly opposed to... socialistic theories. Our aim is to recognize what Lincoln pointed out: The fact that there are some respects in which men are obviously not equal; but also to insist that there should be an equality of self-respect and of mutual respect, an equality of rights before the law, and at least an approximate equality in the conditions under which each man obtains the chance to show the stuff that is in him when compared to hisfellows.

That, from Teddy Roosevelt.

[Serial Mom]

25. Stock Market is where most the 'family' money is made...

Look at this stat...

"In 1957, if you had invested $10,000 in the S&P 500 composite index, with dividends reinvested, your investment would be worth $1.4 million today — a 10.9 annual percentage return. Not bad" but no taxes paid on any of that money EXCEPT on the original $10,000 if it was earned income.

So imagine that families such as Dubya's whose great-grandpa invested probably tens of thousands of dollars in the early 1900s/then dubya's grandpa inherited that money worth a LOT more (and no taxes paid on it) and invested even more of his ill-gotten gain / then poppy - dubya's dad inherited all that money - probably worth millions in the 1950s / and so on.

And now CEOs have been given hundreds of thousands of shares of stock as part of their compensation package and will pass it on to kids. No taxes paid on this money unless a kid sells it with current tax rate of 15% capital gains - but kids are worth so much money in the value of their stock, any bank or financial institution would give them any cash lay out they need in form of low interest loan based on the worth of the stock.

[lumberjack_jeff]

28. It isn't the family's hard work.

The hard work that the kids did was already compensated. Just like any other worker.

What is it about the words "fair" and "tax" that they are obliged to be together in every sentence?

Government (us) have the right to tax anything we want. We have no more or less right to tax estates than we do the purchase of a pack of cigarettes. We choose to do it for the same reasons: we need the money, and tax policy is used to encourage socially positive behavior. Aristocracy isn't a good basis on which to build a society.

Why is it acceptable to tax the income of the minimum wage workers that built their empire, but not the unearned income that the heirs get when dad dies?

The estate tax is far too low. Half of the estate in the example above is exempt from taxation.

... and the estate was generally never taxed. Most estates are unrealized capital gains.

[blondeatlast]

29. Kudos, lj...

Great argument--and the use of the word "we."

Superb.

:thumbsup:

[Warpy]

30. They have built that empire for themselves. It's an ego game

The estate tax wisely came into being because people remembered what had happened in Europe when large estates were passed down through generations tax free. Those families turned into aristocracy and everyone else did without.

If you want to live under an aristocracy, that's all well and good, but the rest of the world has very wisely moved on.

The heirs did nothing to earn the money but be born. It's all income to them and needs to be taxed after a reasonable exemption, including business and farm exemptions, in place now.

Now explain to the rest of us why you hate democracy because inherited empires of wealth are its bitterest enemy.

[Geoff R. Casavant]

33. That's just it -- based on your own example:

The money that was plowed back into the business to expand it was most likely taken as a deduction against income, and thus has never been taxed.

To move from your particular example to a general observation (which has been borne out by IRS data), of the estates that are ultimately subject to taxation, the vast majority of the assets consist of unrealized capital gains, such as stock that has increased in value, and thus have never been taxed. So a tax gets paid upon death, and the heirs get a new basis in the inherited assets (in other words, if they sell immediately they would not pay any capital gains tax themselves).

[Odin2005]

34. To prevent the development of an aristocracy.

[ttwiddler]

35. Two reasons

1. Efficiency. 1000 people each with 1000 dollars do more for economic growth than one person with 1 million dollars. This is a simplistic explanation, but it essentially comes down to the fact that the demand side drives economic growth.

2. Unofficial aristocracy. The estate tax is one of a few key methods that keep feudalism in the past.

[onethatcares]

40. this has been the best thought provoking thread I've read about this subject

ever.

I appreciate the minds that are on this forum for all the thought and insight it provides to some that might have not gone to college or have a hard time putting their thoughts into word that make sense.

You guys rock and ya'll are pretty damn smart.

Thanx

[ChazII]

45. +1000 n.t

[flying rabbit]

50. +1001

threads like this one make this place worthwhile.

[dpibel]

42. About the double taxation argument

You are, without specifically stating it, making a double taxation argument--one of the favorites of the "death tax" propagandists.

But we pay the same sort of "double tax" all the time. Any time you pay sales tax, for instance. You already paid income tax on that money. Now the rapacious guvmint is taxing it again!

This gets brought up in estate tax arguments as if it's axiomatic that there's a one-tax max. It's not.

[proud patriot]

44. Our founders felt inheriting wealth was would lead to inequity

they also felt that allowing the super affluent to consolidate power waway from the majority .

[eridani]

48. Why should you have the right to create a class of parasites?

No one who inherits anything did anything at all to deserve it.

[timtom]

51. Here it is in syllogystic form:

Major premise: We need more of what you have for various nefarious purposes

Minor premise: You have some assets we need to get a piece of

Conclusion: We're gonna make you pay this estate tax.

QED

[rucky]

53. By the same logic, lots of money is "double taxed"

You get your paycheck and pay taxes on it. You buy something with your money and pay taxes on it. The person who received your money uses some of it to pay their employees, then that money is taxed again.

When money changes hands, somebody else has received it and there's lots of ways it can be taxable.

IMHO, money you work for should be taxed less than money you get for having a dead relative.

[grahamhgreen]

54. Because they owe the money to the society that allowed them to create the wealth

and the society owes their offspring the same opportunity.

Without the tax revenue the society decays.

[quaker bill]

55. Basic macroeconomics

indicates all money is taxed until it completely disappears. Every time a dollar changes hands it is taxed. After it changes hands somewhere between 5 to 10 times depending on rates, it is, for all practical purposes, gone.

Inheritance taxes are quite easy to understand. Inheritance funds have been sequestered from the economy, and therefore have not been taxed to oblivion. The inheritance tax just takes a slice.

Secondly, they actually serve a larger social purpose. They were envisioned as a way to prevent a permanent "landed aristocracy" from forming, where the wealthy class builds a permanent grip on the nations wealth and power. Secondly as a benefit, it resets the playing surface nearer to level, making each generation earn its own wealth, though some will have a head start from their parents.

You actually want the wealthy working to obtain their wealth, because that is why they go out and make businesses, and "create jobs". If they can get all they need from passive gains on inherited wealth, why then bother with work?

[pitohui]

56. some people actually love their children

if you are opposed to an estate tax, you are one of those odd people -- and there are a LOT of them in the teabagger community -- who want their children crippled

they want the rich man's child -- who did NOTHING except be born to earn that money -- to get a huge head start on life and to be able to price his own child out of the property market

if you want a middle class child to be able to grow up and own a home, you HAVE to support an estate tax

if you don't want your child to ever be able to own a home, no matter how hard she works, because other children start with millions of untaxed dollars in their pocket, while your child starts with college education debt...fine...you hate your child and i can't deal w. your problems w. hating your own child

but if you want each generation to start w. a level playing field, so that hard work and merit is rewarded, you MUST support a HEFTY estate tax

no one should be rich sitting on their ass and taking money from a dead man, NO ONE, it is completely unfair

i see people who have worked all their lives, worked hard, and have nothing, and you want to defend the right of some asshole to smoke crack all day and inherit the millions HIS PARENTS worked for?

no, this is just not fair

i know americans hate smart people, americans hate working people but i do not understand why they hate merit and why they hate people who work

if you are against the estate tax, you are part of the problem and you need to look into your soul, because if you're not a millionaire, you have a self hate problem that will kill your child's chances

[Gold Metal Flake]

59. +1

[Jakes Progress]

57. It's common sense.

For centuries, civilizations have known that inherited wealth and power never helped society. Roving tribes had rituals where the horses of a leader were sacrificed at his death rather than going to his sons. The leader may have been wise and mighty. His wisdom and might added to the tribe. Giving them to the eldest son only made him powerful without any evidence of wisdom.

This wan't always the case of course. Some societies make the argument you make. You get idiot kings and despots from such a policy. Check out Warren Buffet. You don't get richer than that. He left his kids with a decent starting place and expects them to make their way in the world the way he did. He's giving the rest away.

Getting rich with a dry cleaning shop is proof of two things. The savvy of the owner and the support of the community. If the community didn't support and help the business work, the dry cleaner would never have gotten rich. The small matter of the estate tax belongs to the community.

You make the casual statement that the government would take the fruit of the family's work. Leaving you children several million dollars after the taxes is not taking their inheritance. I would gladly take that five or so million.

The estate tax issue is a word game from the right wing. Very few pay it. Those that do can afford it. Their made up stories about families out on the streets are just so much neo-con propaganda.

[krispos42]

61. To prevent an American aristocracy, a huge class of "idle rich" idiots like GWB.

Of course, the income levels of a very small but extremely powerful segment of the population are such that even if their family lost half of the inherited value, they'd still be extremely powerful.

But can you imagine thousands, tens of thousands, hundreds of thousands of know-nothings with strong ideological convictions deciding to run the business and political worlds? In short, hundreds of thousands of GWBs for the truly conniving power-mongers and lobbyists to use as a puppet in their race for power and control?