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which best describes your view of the inheritance tax?

which best describes your view of the inheritance tax?


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[/LIST]So vote your opinion.

I say do away with all inheritance tax but ditch the idea that money, particularly in the form of campaign contributions, represents constitutionally protected free speech.
 
Wages are payments to factors of production, and are counted as income in national accounting. Inheritance is simply a transfer of wealth from parent to child, and is not income. So despite the fact that they both result in the recipient having wealth they did not previously own, we can make a logical distinction between the two things.

that is currently the distinction the state makes because of certain political considerations. We can just as easily change the definition of INCOME - ie: money which comes in to a persons pocket or account to include capital gains as it most certainly is money which comes in.

You seem to be making the defender of the state or status quo argument that
a) this is how the government currently defines something, and
b) that is how it always has to be defined, so
c) the change you want to make by redefining the subject under discussion cannot be considered because
d) back to a) in a never ending loop.
 
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that is currently the distinction the state makes because of certain political considerations. We can just as easily change the definition of INCOME - ie: money which comes in to a persons pocket or account to include capital gains as it most certainly is money which comes in.

You seem to be making the defender of the state or status quo argument that
a) this is how the government currently defines something, and
b) that is how it always has to be defined, so
c) the change you want to make by redefining the subject under discussion cannot be considered because
d) back to a) in a never ending loop.
So the definition of income doesn't fit your premise and you want to change it? Could that be because there exists no logical premise to unfairly treat differing levels of accumulation with punitive taxes? Methinks so. In other words you are fine with preferential treatment as long as it is punitive towards people who you think "have too much".
 
So the definition of income doesn't fit your premise and you want to change it? Could that be because there exists no logical premise to unfairly treat differing levels of accumulation with punitive taxes? Methinks so. In other words you are fine with preferential treatment as long as it is punitive towards people who you think "have too much".

The definition of income for tax purposes is ANYTHING THE TAXING ENTITY WANTS IT TO BE. You should learn how legislation is written. Its what I do for a living
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I have no idea what you mean by your last statement.
 
First, you are wrong. Here are the current tax brackets according to the IRS

Tax Bracket Married Filing Jointly Single
10% Bracket $0 – $17,400 $0 – $8,700
15% Bracket $17,400 – $70,700 $8,700 – $35,350
25% Bracket $70,700 – $142,700 $35,350 – $85,650
28% Bracket $142,700 – $217,450 $85,650 – $178,650
33% Bracket $217,450 – $388,350 $178,650 – $388,350
35% Bracket Over $388,350 Over $388,350

My example of the person earning one million would indeed find himself in the 35% bracket.

2012 Federal Income Tax Brackets Released By IRS - Novel Investor

Second - your statement about anyone making that amount would be investing is reflective of your own tax strategies and does not apply to all. It is your own opinion based on your own values.

Third - your statement about his estate at death is again you projecting your own tax strategies and values onto others, You have no idea at all what this person may or may not have at the time of death and may in fact end up with nothing in the way of an estate.

My example holds.

JEEZ IS THAT A STUPID POST. I have no dispute that he is in the 35% bracket but he doesn't pay 35% on his entire million. he only pays 35% on income over 388,350 THUS ALL THE INCOME BELOW THAT AMOUNT IS TAXED LESS THAN 35%

THUS YOUR CLAIM HE PAYS 350k IS COMPLETELY WRONG
 
JEEZ IS THAT A STUPID POST. I have no dispute that he is in the 35% bracket but he doesn't pay 35% on his entire million. he only pays 35% on income over 388,350 THUS ALL THE INCOME BELOW THAT AMOUNT IS TAXED LESS THAN 35%

THUS YOUR CLAIM HE PAYS 350k IS COMPLETELY WRONG

I gave you the federal income tax official IRS site. You gave me your opinion and provided no support for it.

Yet again.
 
The definition of income for tax purposes is ANYTHING THE TAXING ENTITY WANTS IT TO BE.
No it isn't. Words mean things, that's why people take the time to compile dictionaries. You have been given the economist definition of income by other posters and myself. The taxing body doesn't even bother calling the inheritance tax an income tax because of the risk of it not standing up to the definition. Words mean things, and that meaning isn't up to selective interpretation.
You should learn how legislation is written. Its what I do for a living
Do you now? Well, I have learned how it's written considering I had to take civics in grade school and poli sci in college. Glad you think people giving you the proper definitions are stupid, but we aren't.
I have no idea what you mean by your last statement.
Oh I think you do.
 
Turtle

I just called my CPA and he said that I do have to figure the tax rate according to how you said to figure it applying the various bracket levels as you go up to $388K. So I will do that and be back with the appropriate figure.

So you were correct about that formula and I was wrong.

And the new total is...... $326,760.00. That is rounded off dropping a few odd dollars here and there. So the actual rate for that millionaire would be 32.6%.

So I do stand corrected.

So we have case #1 - the same earner who ends up paying 32.6% or a tax bill of $326,700 on putting one million dollars in his pocket assuming no other deductions.
Case #2 - the investor who puts a million dollars in their pocket from long term capital gains pays 15% or a tax bill of $150,000.00 assuming no other deductions.
Case #3 - the one who inherits the million dollars that he puts in his pocket pays a tax bill of 0% as his inheritance is excluded with the generous exemption.

So now that the numbers are corrected, can you please explain to Mr Wage Earner why he should be happy to support a system that taxes him at over TWICE the rate it does the investor in capital gains while letting the inheritor off completely free even though all three put the same one million in their pockets and it spends exactly the same?
 
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No it isn't. Words mean things, that's why people take the time to compile dictionaries. You have been given the economist definition of income by other posters and myself. The taxing body doesn't even bother calling the inheritance tax an income tax because of the risk of it not standing up to the definition. Words mean things, and that meaning isn't up to selective interpretation. Do you now? Well, I have learned how it's written considering I had to take civics in grade school and poli sci in college. Glad you think people giving you the proper definitions are stupid, but we aren't.
Oh I think you do.

You really have no idea how laws are written. You really have no idea beyond your college or grad school course how legislation is put together.

Capital gains are treated as they are because the law was written to exclude them that way and the legal definition was crafted for that purpose. Are you that uninformed that you do not know that?

One can easilly write legislation which treats
1- wages and salary
2- capital gains
3- money from an inheritance

as all the same and classify it as income because it is MONEY COMING IN TO PERSONS ACCOUNT OR POCKET. It makes sense and has a basis in the real world.

As such, there would be no problem at all writing the tax law defining income as such.

This is what I do for a living La Mid.... its a bit beyond your grade school civics course or even your polisci 101 in college.
 
You really have no idea how laws are written. You really have no idea beyond your college or grad school course how legislation is put together.

Capital gains are treated as they are because the law was written to exclude them that way and the legal definition was crafted for that purpose. Are you that uninformed that you do not know that?

One can easilly write legislation which treats
1- wages and salary
2- capital gains
3- money from an inheritance

as all the same and classify it as income because it is MONEY COMING IN TO PERSONS ACCOUNT OR POCKET. It makes sense and has a basis in the real world.

As such, there would be no problem at all writing the tax law defining income as such.

This is what I do for a living La Mid.... its a bit beyond your grade school civics course or even your polisci 101 in college.
You can stop the elitism at any time. I worked in radio and got to know many lawmakers both state and national. I do know what I am talking about.
 
Personally I think the inheritance tax is completely unfair and should be considered illegal.

Most of things inherited have already been taxed, as it has be purchased with after tax dollars. So anything taxed again is double taxation.

Now to those that want it .. Saying it’s only fair, then fine lets make it fair … I don’t care what income level, what the amount, lets tax it. If your great grand father passes and leaves you 5 thousand .. It’s taxed. If your parents pass and leave you a 5 million dollar estate it’s taxed, doesn’t matter how much is inherited, what your income level is, it gets taxed.

Of course most that want it, wouldn‘t ever accept such a thing, they are just interested is socking it to someone else. Their being fair ends, when that tax takes from them.
 
You can stop the elitism at any time. I worked in radio and got to know many lawmakers both state and national. I do know what I am talking about.

that is one of the funniest posts ever put here.

Could you play LAST KISS by J. Frank Wilson for me please? Or better yet - the original version by Wayne Cochran. ;)
 
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that is one of the funniest posts ever put here.

Could you play LAST KISS by J. Frank Wilson for me please? Or better yet - the original version by Wayne Cochran. ;)
I have been offered support to run, have you?
 
I have been offered support to run, have you?

You say things and I have no idea what you are talking about.

Could you explain how you running - for whatever it is that you are going to run for - has anything to do with you not knowing how legislation is put together? That would be interesting.

And when you get done with that I would like you to spin I'M GONNA BE STRONG by Gene Pitney.
 
You say things and I have no idea what you are talking about.

Could you explain how you running - for whatever it is that you are going to run for - has anything to do with you not knowing how legislation is put together? That would be interesting.

And when you get done with that I would like you to spin I'M GONNA BE STRONG by Gene Pitney.
If I didn't know what I was talking about people wouldn't offer support. So again, have you ever been offered support to run? You are the one trying to act as if we don't know what we are talking about. So don't complain when you get an answer that you don't like.
 
If I didn't know what I was talking about people wouldn't offer support. So again, have you ever been offered support to run? You are the one trying to act as if we don't know what we are talking about. So don't complain when you get an answer that you don't like.

I run 2,000 mile a year since 1976. I need no support. I do it all myself.

How about DO YOU LOVE ME by the Contours? Can you reach down into the moldie oldies and take that for a spin on the platter that matters?
 
I run 2,000 mile a year since 1976. I need no support. I do it all myself.

How about DO YOU LOVE ME by the Contours? Can you reach down into the moldie oldies and take that for a spin on the platter that matters?
So you've been soundly beaten in the thread and resort to insults. Okay, I'm done with you.
 
So you've been soundly beaten in the thread and resort to insults. Okay, I'm done with you.

You were done before you ever put your toe in the pool. You do not know how legislation is written. That is NOT an insult. It is a statement of fact proven by your own posts.

How about THE LAST TIME by the Stones? Can you dig through the stacks of wax and find that one?
 
And you think the "American Public" is not wasteful and bloated ?
Just look around a little, the money for drugs and cigarettes.....
The money to be given and totally wasted to the political PACs.
I feel that our government, in truth, is rather lean and efficient...but ,IMO, not as lean and they should be.
I think that the trouble is, the conservatives do not think, they just accept Limbaugh's propaganda as Gospel.

your faith in the federal government is touching. Trust me, it is bloated in many areas
 
Haymarket said:
I hve no idea what you are talking about when you say the 15% capital gains tax comes after a 35% tax.
Given that we have discussed and debated precisely this topic before, I find it difficult to believe you are not being disingenuous here. Obviously I am discussing the nominal capital gains and corporate income tax rates. You are going to insist (I know because we have debated this before, though I shall take at face value your implicit claim to have forgotten) that it is incorrect to count the corporate tax as falling on those who receive capital gains; forgetting that stock owners own the company, and that it’s taxes are therefore money out of their collective pool of funds. And, again, as I pointed out to you earlier on this thread, the CBO agrees with me on this point.

You then make some vague statements which cannot be verified.

I have already provided for you in this thread the sources on this.


Please be specific here.
Even at 14%, Romney pays a higher rate than 97% of his fellow Americans, and 88 percent of all taxpayers pay 8 percent or less of their income in income taxes.

From IRS data:

Average_Tax_Rates.png


CBO argues that the Total Effective Federal Tax Rate for top 1% is 30%. Effective Income Tax Rate for top 1% (including Capital Gains) is 19%.

Citing Directly:

… ...High-income households have a disproportionate share of comprehensive income and pay a disproportionate share of federal taxes. The half-percent of the population with the highest income received 14.7 percent of total household income before taxes and paid 22.6 percent of total federal taxes in 2005 (see Tables 2 and 3). People at the top 0.01 percent of the income scale received 4.2 percent of total income and paid 6.5 percent of total federal taxes in 2005...


now I was a history major who loathed his "Mathematics For The Non Math Guy Course You Have To Take To Graduate" class, but it seems to me if you are making 14.7% of the income, and paying 22.6% of the taxes, you are paying a higher rate than someone else, who is offsetting you.

that “someone” is the 97% of Americans who are paying less than the capital gains rate.

case #1 is Richard Dillard, a professional record producer. He earned his million in wages and salary and his hard work and talent took him to the upper ranks of his profession. He is in the 35% tax bracket and will pay a federal income tax bill of $350,000.00.

case #2 is Wanda Phillips, an investor. She made her million off long term capital gains. Her tax bracket is the preferential 15%. She will pay a federal income tax bill of $150,000.00.

Here you are referencing the differences that stem from their different employments. Richard is a record producer, and apparently a high-demand one. His million dollar income will fluctuate, but he is guaranteed an income from his labor. Wanda, however, is an investor – not only is she not guaranteed an income from her labor, but she runs the risk of losing a considerable sum of money. The system you describe is merely acknowledging that Wanda takes significantly greater risks, and therefore has a greater reward when she succeeds. Complaining that Wanda “gets to keep a greater share of her income” is no different from complaining that someone who took out loans and spent years in college to become a doctor has a higher income. Greater Risk, Greater Reward.

case #3 is Ned Sykes, who does not work or invest. He got his million through inheritance. Because the first 5 million is exempt, he pays nothing - zero percent. His federal income tax bill is $0.00.

Good for him. I have a case for you as well:

Case #4 is Joe Schmoe. Joe Schmoe received from his parents a Harvard Education, current cost $48,868 a year for a total of a direct investment of $195,472. In addition, the value of the investment in an educational product that they have given him will continue to grow. A median Harvard Graduate can expect to earn $63,400 right out of the gate, and hit a mid-career salary of $124,000 (a 3.8% annualized gain). Compared to the median income of an American Male ($45,000), we can see that Joe will see an annualized gain that averages out over his working life to about $115,000 a year, making the total amount of wealth Joe has received in this venue $5,156,775.67. Not only does Joe pay no taxes on either the investment of a Harvard degree, or his capital gains thereof, his direct degree investment is actually a tax deduction.

Joe has received from his parents a gift/inheritance/whathaveyou of a value of little over $5 million. How much in taxes should Joe owe on his gift/inheritance/whathaveyou of $5 million?

However, we’re not done there: prior to him going to college, Joe’s parents gave him a raising, currently valued at $222,360. And furthermore, because they wanted him to go to college, they sent him to a private high school, to the tune of another $48K; meaning that Joe has received a further gift/inheritance/whatehaveyou of around $270,000. What should the tax rate on this be? Is your argument is that Joe is a minor, and that minors should not be taxed on wealth they receive?

All of this 5-and-a-quarter million dollars that Joe received came in various forms of wealth, mostly in terms of investment in education. But there were probably others. Joe’s parents probably also bought him a car, took him on vacation, paid for him to take a trip to Europe, and so on and so forth. Had they not given him the wealth in the forms they did, they probably would have given it to him in other forms; perhaps they would have flown Joe’s family down to Disney World with them every year once Joe had kids, or maybe they would have bought a second house near where he works and come in a few months out of the year to provide free baby sitting. Or perhaps they would have saved it all and given it to him when they died. Either way, Joe’s parents are still transferring wealth to Joe in a wide variety of venues. You keep referencing cash, but you aren’t after just cash, you are after wealth. Else you would not be coming after my young cousins should their father die in order to force them to break up their family business, fire the employees, and sell off the pieces to pay your pound of flesh.

All three DID NOT have the one million at the start of the year. All three got their one million during the year. It all spends the same. If you took each of their money and placed it in three stacks of one million dollars each, nobody on the planet could tell you with any accuracy time after time in a test which pile of money came from which source.

But the government knows whose million belongs to who because they put a big label on each and apply preferences and favoritism towards one over the other.

Now Turtle, La, Centinel, Thrilla, and anyone else who can - tell Richard Dillard why he should be happy to pay a tax bill of $350,000.00 on the same amount of money that Wanda Phillips only pays $150,000.00 on and Ned Sykes pays nothing on.

Still pretending not to understand tax brackets, or the differences between nominal and effective rates? Do you even really believe in the particulars here, or is this just kind of a general sense that “we should tax more, and we should tax the rich a lot more” and this is how you just happen to express that inclination?

And feel free to use the word FAIR all you want in your explanation.

And that would you too cpwill.

Sure. I think it’s fair to allow Wanda to keep a greater return given her greater risk. I don’t think it’s fair to protect the uber-wealthy and the big corporations from competition from smaller, family owned start-ups. You speak of favoritism and preferences and prefer fairness. Fairness would be a flat tax if not a straight up Government User Fee – let me know when you decide to support either of those. I happen to think it is perfectly fair to only tax certain things without having to tax all things. I don’t think it’s particularly fair that we have turned the tax code into a redistributive model, where portions are designed solely to punish some for working hard and getting ahead while rewarding others for not doing so. And I sure as hell don’ think it’s fair for my uncle’s employees find themselves out in the street along with their families because you wanted to make sure you got your piece from my little cousins.

You may think you are aiming at the rich with such a measure, but you are hitting small businesses and their lower-to-middle-income employees.
 
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and again, I would like to say, it's gratifying to see the results of this poll. I guess even across ideological lines, the thought of going after grieving families has an "ick" factor.
 
I think it’s fair to allow Wanda to keep a greater return given her greater risk.
You could apply the same logic to winnings from gambling but as far as I know those winnings are taxed as normal income. One has to assume - and it's evident in the way people buy different stocks - that stocks at greater risk have a higher return. If Wanda really wants more money she should invest in higher risk stocks, not IBM (or whatever the current "sure bet" is). This is the biggest issue I have with the capital gains tax. Either way you slice it, as a winning bet or interest on uninsured savings, Joe Schmoe has to count it as normal income but Wanda doesn't.

I'm still thinking about the inheritance tax - you made a good point earlier (and repeated it here) about it also being protectionism.
 
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from cpwill

Obviously I am discussing the nominal capital gains and corporate income tax rates. You are going to insist (I know because we have debated this before, though I shall take at face value your implicit claim to have forgotten) that it is incorrect to count the corporate tax as falling on those who receive capital gains; forgetting that stock owners own the company, and that it’s taxes are therefore money out of their collective pool of funds.

As you well know, and your post clearly indicates this, these are two separate taxes paid by two separate entities. A corporation is a legal entity with its own obligations and responsibilities of taxation. A shareholder is a different entity with its own obligations and responsibilities of taxation. To attempt to add both as if they both are paid by the same entity is factually wrong and intellectually fraudulent.

from the wikipedia entry on corporations previously cited here many times in many threads

A corporation is created under the laws of a state as a separate legal entity that has privileges and liabilities that are distinct from those of its members

We have been through this time and time and time again in thread after thread after thread. The right will will not give up its false claim to this myth of double taxation no matter how many times reality is pointed out to them. You, attempting to add numbers together in this way, underlines that point yet again.

but it seems to me if you are making 14.7% of the income, and paying 22.6% of the taxes, you are paying a higher rate than someone else, who is offsetting you.

that “someone” is the 97% of Americans who are paying less than the capital gains rate.

And I have repeatedly said that I want ALL Americans to pay 5 points more on their federal income tax and that includes the demonized 47% created by the 2001 and 2003 Bush tax cuts and the Republicans in both houses of Congress who provided 93% of the YES votes to create these non taxpayers.

As to your Greater Risk- Greater Reward..... in a word sir - BALONEY. Explain to the millions of people who have lost their employment over the last few years how

but he is guaranteed an income from his labor.

Risk is there for many workers and evidence of losing jobs, reductions in salary, and reductions in benefits shows that precious little is "guaranteed" to use your word. Workers have not only lost all that but pensions also that they counted on. They took a RISK with a particular employer and they lost.

I think it’s fair to allow Wanda to keep a greater return given her greater risk.

So if we take your belief and follow it , should we then also apply discriminatory and preferential tax rates to Americans who also take huge risks in the investment they made in their careers? Should we give a preferential and discriminatory tax rate to the fire fighter because RISK is a greater part of their job than that a grocery clerk?
Should we give a preferential and discriminatory tax rate to the police officer because RISK is a greater part of their job than that of a grade school teacher?

Where does this public subsidizing of private RISK stop? Or are you unfairly limiting your concept of RISK to only money from investors and ignoring the real RISK many take constantly in their choice of careers and in the daily performance of their jobs?

Where is the conservative love for "small government" that stays out of the lives of American citizens? You clearly want the government to subsidize the investor by giving them preferential and discriminatory rates which subsidize their risk and investment. Its about time the conservative live up to their mantra of getting government out of the lives of citizens and this is a place to begin. You talk about FAIR and FAIRNESS but subsidizing the investor and their risk is hardly FAIR when we do not subsidize the worker and the risk they take with their employment and jobs. That is not FAIRNESS - it is discrimination based on a source of income which we know disproportionately benefits the upper tier earner over average working people. That is the opposite of FAIR. It is clear and obvious DISCRIMINATION and the awarding of PREFERENCES and a perfect example of the Golden Rule as in those with the gold make the rules.

Your case 4 with Joe seems to have placed you on the same road to fantasy land that others have attempted to travel down complaining about bowls of oatmeal and gifts of books. Parents educating children, feeding children, raising children - the law deals with that in the current tax laws. Gifts are deal with also.

So Joe and his educational investment were worth more than community college costs. That is simply one of the variances of life and we accept that. Again, we know the difference between an outright inheritance and tranfer of wealth in millions of dollars from one person to another and that of a gift of paying for education. Lets not pretend we don't. That sort of things is easy to deal with in legislation and I do it all the time.
 
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You could apply the same logic to winnings from gambling but as far as I know those winnings are taxed as normal income. One has to assume - and it's evident in the way people buy different stocks - that stocks at greater risk have a higher return. If Wanda really wants more money she should invest in higher risk stocks, not IBM (or whatever the current "sure bet" is). This is the biggest issue I have with the capital gains tax. Either way you slice it, as a winning bet or interest on uninsured savings, Joe Schmoe has to count it as normal income but Wanda doesn't.

I'm still thinking about the inheritance tax - you made a good point earlier (and repeated it here) about it also being protectionism.

gambling doesn't create anything of value nor does it benefit society as a whole as investment does
 
Lost in all the diversion about taxes on dividends is an undeniable fact

the same entity (federal government) gets two cuts at the same pot of money and there is no transfers of that money that involve any additional exchange of value

Haymarket-tell us why the government is entitled to 61% of that money
 
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