Furthermore, when the son sells the stock, he will sell it at the stepped up basis of $15, not the carry over basis from his deceased father. Therefore, the gain would never have been taxed. Welcome to basic estate taxes 101. It appear the class knows virtually nothing.
But that's not how it works. Assets get a stepped up basis upon transfer from the estate. Therefore, if you sold the painting with an original basis of $20k which was then stepped up to $50k, there would be no taxable income from that transaction. Thus, we have an estate tax to compensate for that.If my father buys a painting for 20K and leaves it to me, and at the time of his death its worth 50K I shouldn't have to sell it to pay taxes on it. HOwever if I do sell it, the capital gain should be taxed and that is 30K
If we wanted to do it your way, we'd have to spend huge amounts of time and money to police tax exempted organizations as people with low basis but high FMV items would simply donate them to charities they controlled, have the charity sell it and then pay themselves a salary from that transaction.
Last edited by obvious Child; 07-28-10 at 10:56 PM.
"If your opponent is of choleric temperament, seek to irritate him." - Sun Tzu
Hell yes, it was correct to vote the Bill down.
- Dynastic wealth is not good for the country.
- The very wealthy already have ways to shelter their wealth through various foundations.
- If there is no estate tax, then the heirs get the money tax free. To claim this is double taxation is ludicrous. (If you earn money, you are taxed for it. If you use that profit to pay an employee, they will have to pay taxes on those earnings)
- The heirs need to use their ingenuity to earn their own wealth.
- Make the limit high enough that people don't lose their business.
better yet lets get rid of this abomination--if its so great why apply it only to a small voting block? Because it is designed to further the power of those who pander to people who think like you. It is not designed as an efficient an fair revenue producer but a tool that political pimps use to get power
Estate tax in the United States - Wikipedia, the free encyclopedia
As far as I can tell, transfer = income. However, I would not be opposed to taxing it as income since that is what it is. At least the money portions of it. I think stuff or land should be taxed at the market rate from a base of $0 at the time of sale.The estate tax in the United States is a tax imposed on the transfer of the "taxable estate" of a deceased person, whether such property is transferred via a will, according to the state laws of intestacy or otherwise made as an incident of the death of the owner, such as a transfer of property from an intestate estate or trust, or the payment of certain life insurance benefits or financial account sums to beneficiaries. The estate tax is one part of the Unified Gift and Estate Tax system in the United States. The other part of the system, the gift tax, imposes a tax on transfers of property during a person's life; the gift tax prevents avoidance of the estate tax should a person want to give away his/her estate.
Last edited by tacomancer; 07-29-10 at 07:46 AM.
I think they just want to regress to an earlier time of lords , serfs, and slaves. And continual warfare between the haves and the have-nots.
Its dems who really want a system of lords and serfs.. we have problems when too many people don't have to pay any taxes and yet feel a need to constantly raise them on others because they have the same mindset as you do--ultra wealthy is anyone making more than you
the death tax is an abomination-look at the arguments for it-its all based on envy and greed of those who are upset they didn't have wealthy parents.