Biden Estate Tax Proposals

[Gregmal]

2 hours ago, wachtwoord said:

 

And once again Greg nails the thread.

 

Estate, inheritance, death taxes are the most unfair taxes out of the lot of them. It's already taxed wealth (usually several times over) and sometimes even originated abroad (in situ assets are covered).

I consider myself an employee of the family. Both my wife and I at this point realize that everything revolves around the kids. Theyre the number 1 in our lives. Everything we do is for them. Which includes earning to ensure their future prosperity and quality of life. The notion that an unfortunate event(death), entitles a freeloading 3rd party to some windfall, at our expense, is ludicrous. 

[John Hjorth]

The topic here should be split. A part of it should go to the Politics Forum, another part of it should go to the Personal Finance Forum.

 

Stop whining, [or post on the Politics Board]. 

 

Instead, you could in the Personal Finance Forum post & share your findings, and how you have approached this issue [It should be by country, naturally].

[JRM]

Bitcoin fixes this.  Just kidding, but not entirely.

 

The estate tax is an insult to 99% of the people it applies to.  My 97 year old grandmother saved and lived beneath her means with a depression era mindset her entire life.  She could have spent and squandered her money like most, but she chose not to.  She started life poor, and earned her money.  Taxed all along the way.  

[Castanza]

7 hours ago, DooDiligence said:

 

Inheritance is a form of income and income is legit taxable.

 

Silver spoons don't feed based on merit. Misaligned incentives make for bad executives / legislators / legislation / adjudicators.

 

https://ips-dc.org/press-release-americas-wealth-dynasties-2021/

Silver spoons don’t make up 90% of the people who would be affected by this. Is a 3.5m inheritance anywhere near silver spoon status? I mean hell Im young and will probably need a lot more than that to retire. 
 

There are better ways to tackle the “issue” if people believe there to be one. This type of stuff always comes with unintended consequences

[Gregmal]

The "consequence" is that the elitists who employ expensive lawyers and accountants get around the taxes(or greatly reduce them) and the normal folks who just try to play by what they can understand get screwed. 

[DooDiligence]

2 hours ago, Castanza said:

Silver spoons don’t make up 90% of the people who would be affected by this. Is a 3.5m inheritance anywhere near silver spoon status? I mean hell Im young and will probably need a lot more than that to retire. 
 

There are better ways to tackle the “issue” if people believe there to be one. This type of stuff always comes with unintended consequences

 

$3.5m is not what I'd consider a large estate.

I'm not smart enough to figure where the line should be drawn.

Some kind of progressive schedule starting at ???

[Guest]

I think we should have much higher taxes or no bailouts. I think it's crazy that the wealthy get to stay wealthy due to government bailouts and low taxes. I mean, it's the poor and middle class that get screwed in this system. Stocks go down? Government steps in (creating deficits). Paying too much in taxes? Government steps in (creating deficits). It's a nice gig for folks with money. I mean, personally, it works for my family but that doesn't mean that's the way it ought to be. 

[TwoCitiesCapital]

16 hours ago, stahleyp said:

I think we should have much higher taxes or no bailouts. I think it's crazy that the wealthy get to stay wealthy due to government bailouts and low taxes. I mean, it's the poor and middle class that get screwed in this system. Stocks go down? Government steps in (creating deficits). Paying too much in taxes? Government steps in (creating deficits). It's a nice gig for folks with money. I mean, personally, it works for my family but that doesn't mean that's the way it ought to be. 

 

+1

 

As far as it being a smack in the face to savers, I don't mind offending the dead. 

 

As far as it going to "free loading 3rd parties", just know your kids could be described the same way. They didn't earn it - you did. 

 

I'm all for the productive members of society getting to keep as much of the value they create as possible. I'm not ok with dynastic wealth that bestows power and privilege upon generations of people who did nothing to add value to society to earn it. 

Edited September 7, 2021 by TwoCitiesCapital
Fixed typo

[thowed]

I sympathise - it's simple - I'm against double taxation.

 

But I'm also jealous.  In the UK the threshold is below US$500k!

[Castanza]

On 9/7/2021 at 2:35 PM, TwoCitiesCapital said:

 

+1

 

As far as it being a smack in the face to savers, I don't mind offending the dead. 

 

As far as it going to "free loading 3rd parties", just know your kids could be described the same way. They didn't earn it - you did. 

 

I'm all for the productive members of society getting to keep as much of the value they create as possible. I'm not ok with dynastic wealth that bestows power and privilege upon generations of people who did nothing to add value to society to earn it. 

 

They're YOUR kids, not some external 3rd party to the family. Who are you to say how and when you can provide for them? The idea that it's wrong to provide for your direct descendants after death is somehow wrong and immoral is a ridiculous notion. If anything it's considered responsible, and "planting a tree so others can sit in its shade."  Kids don't earn any of the money when being raised as well. Maybe we should limit how much parents can spend on their children every year too. 

 

If you're against "dynasties" then work on fixing the loopholes. If you're worried about "power" of said families then go after lobbying monopolistic regulations, etc. This addresses the exact wrong end of the problem. It non of the governments business what one does with their money within their family and they have no business taking any of it which has been taxed half a dozen times. Not like the govt is a great steward of wealth management to begin with. 

[wachtwoord]

On 9/5/2021 at 4:25 PM, DooDiligence said:

 

Inheritance is a form of income and income is legit taxable.

 

Silver spoons don't feed based on merit. Misaligned incentives make for bad executives / legislators / legislation / adjudicators.

 

https://ips-dc.org/press-release-americas-wealth-dynasties-2021/

Income? It's just moving property from one person to another. Or do you consider the ome receiving the inheritance (spouse, children) employee of the deceased? It's not income.

[RichardGibbons]

41 minutes ago, wachtwoord said:

Income? It's just moving property from one person to another. Or do you consider the ome receiving the inheritance (spouse, children) employee of the deceased? It's not income.

 

Income does not imply in any way a working relationship. It just implies money coming in.  e.g. gambling profits, capital gains, insurance payouts, and gifts are all income.

[Castanza]

11 minutes ago, RichardGibbons said:

 

Income does not imply in any way a working relationship. It just implies money coming in.  e.g. gambling profits, capital gains, insurance payouts, and gifts are all income.

So a loophole for the government? Should probably close that one too 

[Gregmal]

14 minutes ago, Castanza said:

So a loophole for the government? Should probably close that one too 

Its the same thing as Ive raised a million times before about property taxes and their absurdity. You and I both own an acre of land. Why in the fuck does we have different property taxes? What business is it of any politician what I put on my land if its of no threat to anyone else's freedom? If Im using more sewer/water resources, sure, charge me. But what business do you have robbing me because I have a 3,000 sq ft home on it vs a 1200 sq ft one? Or when I need a new water heater? Why am I paying them $70 for a permit? Its all nonsense however they've pitted it so people are either complacent or view it as an "us vs them" issue, which is the case with estate taxes. Keep the number high enough for the lemmings not to care and you can bully everyone else.

[TwoCitiesCapital]

5 hours ago, Castanza said:

Maybe we should limit how much parents can spend on their children every year too. 

 

If you're against "dynasties" then work on fixing the loopholes. 

 

 

We don't regulate how much you can spend, but we do currently regulate how much you can gift to them in a given year, and over your life, already. I don't see why this is any different. 

 

And higher estate taxes and closing loopholes aren't mutually exclusive. I'm for both and view both much more favorably than income taxes and capital gains hikes  

Edited September 9, 2021 by TwoCitiesCapital

[Castanza]

22 minutes ago, TwoCitiesCapital said:

 

 

We don't regulate how much you can spend, but we do currently regulate how much you can gift to them in a given year, and over your life, already. I don't see why this is any different. 

 

And higher estate taxes and closing loopholes aren't mutually exclusive. I'm for both and view both much more favorably than income taxes and capital gains hikes  

I don’t agree with the limitations on gifts for family members either. Here in PA we have a state death tax of 4% for family members distributions, 12.5% for extended family and I think 15% for friends give or take a few percent. I think it would be better if immediate family was zero and you stepped up from there.

 

Would you rather have family members looking after descendants or government? These types of policies stifle ambition, progress, responsibility etc. and encourage more loopholes and under the table dealings. 
 

Simply put, it’s no business of the government.  

[patience_and_focus]

52 minutes ago, Castanza said:

I don’t agree with the limitations on gifts for family members either. Here in PA we have a state death tax of 4% for family members distributions, 12.5% for extended family and I think 15% for friends give or take a few percent. I think it would be better if immediate family was zero and you stepped up from there.

 

Would you rather have family members looking after descendants or government? These types of policies stifle ambition, progress, responsibility etc. and encourage more loopholes and under the table dealings. 
 

Simply put, it’s no business of the government.  

 

Shouldn't the descendants be able to look after themselves with the $3.5 million (or current 11M) that they can get tax free (plus the after tax portion of the rest of the amount)? And this is usually after all the education expense have been paid for already which by the way is absolutely fine by me. But if they can't look after themselves even with all this amount post education, then they are neither ambitious nor skilled in money making.

 

In olden days one could get power or grab land by hook or by crook, become king (or feudal lord) and then their descendants lived rich ever after while the large section of populace just suffered. 

Edited September 9, 2021 by patience_and_focus

[TwoCitiesCapital]

51 minutes ago, Castanza said:

I don’t agree with the limitations on gifts for family members either. Here in PA we have a state death tax of 4% for family members distributions, 12.5% for extended family and I think 15% for friends give or take a few percent. I think it would be better if immediate family was zero and you stepped up from there.

 

Would you rather have family members looking after descendants or government? These types of policies stifle ambition, progress, responsibility etc. and encourage more loopholes and under the table dealings. 
 

Simply put, it’s no business of the government.  

 

Give me a break. Estate taxes would impact ambition, progress, and etc far less than income and capital gains tax do. Why? Because once your dead you stop giving a shit....some people even before then. 

 

I think it'd be nothing but net positives to reduce income and capital gains and increase sales taxes and estate taxes. I'm all for shutting down the loopholes and doing away with Trust-like structures and insurance products whose primary purpose is to avoid taxes on generational wealth which is how the wealthy get around stuff like this. 

 

[DooDiligence]

Schools, roads, bridges all just appear out of thin air.

Soldiers build their own weapons & fight for free.

What a country...

[Gregmal]

1 hour ago, DooDiligence said:

Schools, roads, bridges all just appear out of thin air.

Soldiers build their own weapons & fight for free.

What a country...

Schools are locally funded generally. Same with much of the roads. But generally, I would be all for it if those were the things the money went to. Unfortunately, we've been hearing the "paying their fair share" argument in perpetuity and 1) its never just schools, roads, weapons and bridges. They always have to chuck in the "other" shit. And 2) why are the majority of those things currently in such terrible shape if thats where the funds go/need to go? Its not like the US doesnt generate any tax revenue...Its a game and a scheme designed to keep people oppressed and reliant on big brother. 

[DooDiligence]

23 minutes ago, Gregmal said:

Schools are locally funded generally. Same with much of the roads. But generally, I would be all for it if those were the things the money went to. Unfortunately, we've been hearing the "paying their fair share" argument in perpetuity and 1) its never just schools, roads, weapons and bridges. They always have to chuck in the "other" shit. And 2) why are the majority of those things currently in such terrible shape if thats where the funds go/need to go? Its not like the US doesnt generate any tax revenue...Its a game and a scheme designed to keep people oppressed and reliant on big brother. 

Now we’ve come back full circle.

 

Incentives for our national leaders are not aligned with what’s good for the country as a whole. The longest tenures go to those who have the skills to attain and remain in office but who lack the abilities (and will) to execute plans and legislation that are in the best interest of our country.

 

Term limits. One and done.

Campaign finance reform.

Publicly funded campaigns.

No private or personal funds allowed.

Run out of $, too bad.

Run out of time, back to the private sector.

 

Passing on massive estates ensures the consolidation of power and perpetuates misaligned incentives and incompetence.

Evolution now or revolution later.

[hasilp89]

3 hours ago, patience_and_focus said:

Shouldn't the descendants be able to look after themselves with the $3.5 million

What I don’t get about this mindset is it implies that someone benefiting from his/her parents hard work and prosperity limits someone else's ability to live a decent and happy life. And at the same time it assumes that by taking that money away and giving it to the government that someone else will be off.

 

churchill said it best “the inherent vice of capitalism is the unequal sharing of blessings. The inherent virtue of socialism is the the equal sharing of miseries.”
 

[patience_and_focus]

3 hours ago, hasilp89 said:

What I don’t get about this mindset is it implies that someone benefiting from his/her parents hard work and prosperity limits someone else's ability to live a decent and happy life. And at the same time it assumes that by taking that money away and giving it to the government that someone else will be off.

 

churchill said it best “the inherent vice of capitalism is the unequal sharing of blessings. The inherent virtue of socialism is the the equal sharing of miseries.”
 

 

1. I think we are agreeing that limiting amount of money as a handout from either the govt or parents should not limit once's ability to live a decent and happy life. 

 

2. Someone has to pay for nearly a 750B dollar in defence spending even if everything else is cut immediately to zero. As TwoCitiesCapital said - let the dead pay and lower other taxes for everyone else. Sets right incentives.

 

3. As for Churchill, I would say follow what a man does, not what he says - 

https://en.m.wikipedia.org/wiki/People's_Budget

"The 1909/1910 People's Budget was a proposal of the Liberal government that introduced unprecedented taxes on the lands and incomes of Britain's wealthy to fund new social welfare programmes......It was championed by the Chancellor of the Exchequer, David Lloyd George, and his young ally Winston Churchill..... it was the first budget in British history with the expressed intent of redistributing wealth equally amongst the British population"

Edited September 10, 2021 by patience_and_focus

[hasilp89]

6 hours ago, patience_and_focus said:

 

1. I think we are agreeing that limiting amount of money as a handout from either the govt or parents should not limit once's ability to live a decent and happy life. 

 

2. Someone has to pay for nearly a 750B dollar in defence spending even if everything else is cut immediately to zero. As TwoCitiesCapital said - let the dead pay and lower other taxes for everyone else. Sets right incentives.

 

3. As for Churchill, I would say follow what a man does, not what he says - 

https://en.m.wikipedia.org/wiki/People's_Budget

"The 1909/1910 People's Budget was a proposal of the Liberal government that introduced unprecedented taxes on the lands and incomes of Britain's wealthy to fund new social welfare programmes......It was championed by the Chancellor of the Exchequer, David Lloyd George, and his young ally Winston Churchill..... it was the first budget in British history with the expressed intent of redistributing wealth equally amongst the British population"

1. I’m not agreeing, if my parents built a business with the intent of me continuing it, it’s not a handout and I do t see why it should be taxed to pieces. Maybe this is cultural, for Indians this is very normal. My dad wanted me to join the family business and continue it for him. So it’s not a matter of handouts.

 

2. Pretty sure individual income taxes cover it. Cut the spending. Don’t use wasteful spending as an excuse. Look at the numbers. https://datalab.usaspending.gov/americas-finance-guide/revenue/categories/

 

3. Good point and I have. I was more liberal in my younger days also. He turned conservative for true ideological reasons or just opportunistically. The man made a tremendous amount of mistakes in his life. Doesn’t mean what he said isn’t right.

[JRM]

https://home.treasury.gov/news/featured-stories/the-case-for-a-robust-attack-on-the-tax-gap

 

The estate tax makes the most sense for people who can afford not to pay it.  I'm not sure what else there is to say.