Seattle Times publisher Frank Blethen announced today that the paper will change its name to the Death Tax Repeal Times so as to better reflect the interests of its core audience — which judging from the content of its op/ed pages pretty much consists of Frank Blethen.
Of course I’m kidding. (About the name change.) But seriously… doesn’t Frank get even the teeniest bit embarrassed using his paper to so shamelessly and relentlessly shill for this issue? Today his op/ed pages actually hit the issue twice, with both an unsigned editorial and a guest column from high-priced lobbyist Jennifer Dunn.
I dunno, I just think we should expect better from a news organization that aspires to be our city and state’s paper of record.
(That said, the Times also has a great editorial on Dean Logan. Credit where credit is due… though it would have been nice if the paper had displayed this kind of moral support and blunt reporting while Logan was still in the job.)
UPDATE:
In the comment thread, N in Seattle points to the editorial cartoon today by Devericks, which equates the estate tax with grave-robbing. “Quite the trifecta for old Frank.”
Don’t forget the editorial cartoon by Devericks, where the estate tax is equated with grave-robbing. Quite the trifecta for old Frank.
I think the proposal by Jon Kyl makes a lot of sense — 15% estate tax rate, and $5 million exemption. 15% is the same as long-term capital gains. Inherited property doesn’t other get capital gains tax — if mom & dad bought their house for $35,000, and it is worth $450,000 when they die, the purchase price (“basis”) their heirs use when selling it for capital gain computation is $450,000 and not $35,000. 15% is lower than the income tax rate, but to the extent the deceased acquired property through income, they have already paid income tax on that money.
The Seattle Times is now in favor of this 15% death tax, instead of a 0% death tax. Their position is reasonable. And I will predict that it will pass both the House and Senate and be signed into law by President Bush before the end of the year. You won’t have 41 Democrats filibustering against a 15% death tax.
More shilling for the Right, Richard. Perhaps now your aspirations are to a job writing guest editorials. In the interests of full disclosure:
Richard Poop is a failed politician. (When is your next scheduled defeat Richard?) Judging from some of his ramblings with regard to the law (on at least one occasion he conflated criminal procedures with civil) he cannot be too snazzy a lawyer. (The old law practice not keeping you busy enough,Richard?)
His only hope appears to be getting on as a paid RightwingWhackjob troll. Hence, he confuses quantity for quality in his posts. Of necessity the quality suffers.
You know what? I am sick and tired of the damn cry-baby Republicans running this country.
We are running up massive debt, can’t pay our bills and if you haven’t noticed we are in a damn elective WAR when Bush got clever and decided that he would use terrorism as an excuse to occupy a foreign country.
We have massive bills rolling in folks and I can’t believe even someone like you Pope could stand in public and demand a tax cut for the super-rich. You guys are all politics with no frickin’ clue how to run a country.
What the hell? Someone is going to have to pay the bills and if Repubclicans can’t handle the responsibility then lets get some adults in charge.
You can’t have your cake and eat it too you dumb fucks! Learn to pay the bills or get out. Bankrupting our children so Paris Hilton can buy a second (third) fucking yacht doesn’t do the country a damn bit of good.
If the Blethens are the poster children for estate tax repeal, they ought to double the sucker.
I posted this yesterday, but in light of today’s Times editorial, it seems fitting to do so again:
Horsey’s 6/13/2006 article about Sen. Fist and the Estate Tax:
http://seattlepi.nwsource.com/.....sp?id=1408
Perhaps there is a compromise. I notice that estate tax proposals don’t take into account the number of people actually receiving the estate. For example, a $5,000,000 estate left to one single individual is quite a big deal, but the same-sized estate left equally to 25 separate individuals is a tidy sum for each at $200,000 each, but not instant “Bill-Gates-level” wealth.
If we must have an estate tax (and I don’t support the idea), then let’s tax estates based on their effect on single individuals and not on an overall basis. Suppose we make the “tax-free” transfer $1,000,000 per individual with some flat rate tax for the aggregate amount about that level. This is win-win for everyone. The left gets to have an estate tax for the really, really wealthy, and the wealthy are forced to engage in wealth re-distribution by having to leave “chunks” of their estates to idnviduals so as to be under the estate tax limitation. Another benefit is that the wealthy, while being forced into wealth re-distribution, get to decide who their wealth gets re-distributed to, and a careful planner can prevent the government from getting a nickel!
If we have to have the damn thing, let’s make it so that the wealthy have total control of their estates. The wealth can be transferred to private hands, and that’s always better than having government grab it!
It isn’t just the “super rich” who pay death taxes. A lot of ordinary folks get stuck with it as well.
My daughter’s great-grandfather for example. Passed away in October 2005 at age 83. He was at Pearl Harbor on December 7, 1941 when it was attacked. Retired from the Navy after 20-some years of enlisted service. Then worked an ordinary job at Boeing for another 20-some years and retired from there as well. Saved his money, spent it wisely, paid off the mortgage on his home in full, and didn’t refinance away the equity every few years like lots of irresponsible folks like to do this days. Bought a modest plot of land on the shore of Lake Chelan in the early 1970’s. Had a trailer on it for many years. Then built a house on it in the mid-1980’s after he had his mortgage in Woodinville paid off. Paid off the debt on the Lake Chelan property in full as well. Paid income taxes on every single penny that he used to purchase the Woodinville and Lake Chelan properties, as well as on the money he had put into savings. Used a lot of his own labor to improve and maintain these two properties as well.
Needless to say, the Woodinville and Lake Chelan properties are now worth a lot more than what it cost to purchase them and build upon them. So the estate value is a few hundred grand or so over the $1.5 million exemption applicable in 2005. The death tax starts at about 45%, and his heirs (my ex-wife, her uncle, and a couple of her cousins) will have to pay six figures worth of estate tax as a result.
Now if this fine gentleman had just managed to survive another three month, and had passed away in January 2006 or later, the death tax exemption would have raised to $2 million, and not a penny would have been owed in death tax.
Of course, liberals like Goldy and our fine U.S. Senators from Washington want to repeal the death tax reduction that the GOP passed in 2001 — which would result in the exemption going back down to $600,000 or so.
This means that almost anyone dying in King County — who managed to pay off their home mortgage and had an average or better family home — would be stuck with paying a significant amount of death tax, even if they didn’t have too much in other assets.
Is $2 million super-rich? Is $1.5 million super-rich? Is $600,000 super-rich? Should the federal government take 45% or more of any property that someone leaves in excess of these amounts?
And for that matter, why should someone be punished by over a hundred thousand dollars, simply because they died three months earlier than was optimal for tax planning purposes? Think about that one next time you think “death tax” is a perjorative term for this type of tax levy.
And by the way — my daughter’s great-grandfather happened to be a life-long DEMOCRAT (but not one of those ultra-liberal ones by any means). Maybe he wouldn’t be voting for Maria Cantwell this fall if he were still alive …
Richard @ 8:
Excellent comments! Had the same situation occur with my ex-father-in-law. The Feds and the state of Massachusetts got about 55% of the TOTAL estate value! The FIVE DAUGHTERS got the remaining 45% and 90% of THAT was retirement funds! So, guess what: the girls have to pay INCOME taxes on the money from the retirement accounts as they withdraw it!!
Don’t you just LOVE the socialist nature of our tax code!!!
Devericks won’t get a Pulitzer Prize for that cartoon, but he may get a promotion (“deputy chief assistant editorial brown noser”) or at least a bonus (“good work, Derericks, you’ll find an extra $5 in your pay envelope this month “).
CHER BUYS IMPROVED HELMETS FOR U.S. TROOPS IN IRAQ
Memo to Wingnut Traitors: Another one of those Hollywood liberal icons you anti-American fucks love to hate is supporting the troops by donating over $100,000 of her own money to do something your idol, George W. Bush, won’t do — supply the troops with battle helmets that will save their lives.
http://www.marketwire.com/mw/r....._id=134759
Libertarian @ 7
Your suggestion is worth discussing. One of the original congressional justifications for imposing an estate tax is that such a tax deters the generational perpetuation of monied estates. In other words, an estate tax discourages the development of aristocracies. As we know, our forefathers detested aristocracies, believing them to be an impediment to democracy. Teddy Roosevelt (ironically, given his family wealth) was a proponent of the estate tax for precisely this reason. Of course, today’s Republicans want to encourage the development of aristocracies, like that of the Bush family, because democracy is a messy, uncontrollable process. Your suggestion would at least have some tendency to discourage too much accumulated wealth. I suspect, however, that tax planners would quickly find a way to draft around any requirements of spreading around an estate’s luchre.
CORRUPT REPUBLICANS RUN POLICE STATE IN FLORIDA COUNTY
From the seedy town of Alachua, Florida, comes an incredible tale of corrupt Republicans running a police state in which the police commissioner counts ballots and a Democratic candidate was jailed for requesting public records and attending city council meetings.
http://www.rawstory.com/news/2....._0612.html
2
I think a 15% tax rate and $5 million exemption for wages makes more sense than for inherited windfalls. If you tax people for money they work for, and give tax exemptions for money people don’t work for, why in hell should anybody work?
I know! Since we’re sending half our jobs to other countries and giving the other half of our jobs to illegal immigrants willing to work for $2 an hour, let’s create a 21st-century U.S. economy based on inheriting money from each other!
If I inherit $4.99 million for you, and you inherit $4.99 million from me, we’ll both be multimillionaires and neither of us will have to pay taxes!
For picture of Richard Pope’s economic plan, click here:
http://en.wikipedia.org/wiki/I.....hopter.JPG
(Man, I LOVE that photo!!!) (raucous bunny laughter in background)
15% of every tax dollar goes to pay interest on the national debt. Guess who owns most of those government bonds.
Hint: It’s not “welfare queens”.
4
” … I can’t believe even someone like you Pope could stand in public and demand a tax cut for the super-rich.” Commentby Nindid— 6/14/06@ 11:06 am
What do you expect from a FREELOADER who uses the taxpayer-financed Voters Pamphlet to advertise his law practice?
Problem is with repealing the estate tax is that it means that other groups of taxpayers are going to pick up the slack either as a total sum for taxes or as a percentage of total taxes.
If we are going to reduce taxes, how about lowering the income tax or the exemption for when you have to start paying income taxes.
If there is going to be a tax reductio, why should the multi-zillionaires get it?
4 (continued)
What these trolls don’t get is the assholes they shill for are fucking them, too.
“Is $2 million super-rich? Is $1.5 million super-rich? Is $600,000 super-rich? Should the federal government take 45% or more of any property that someone leaves in excess of these amounts?”
With proper estate planning, one can have at least 5 million passed on with no estate tax paid whatsoever under the current law.
2
Hey Richard, if Howard Hughes bequeaths $1 billion to Melvin Dummar, that’s income for Dummar.
7
I could go with taxing inheritance income, instead of levying taxes on bulk estates. That’s wholly consistent with my position that dead people can’t (and don’t) pay taxes, and it’s actually the heirs who are being taxed. But I think the exemption for inheritance income should be the same as the exemption for wage income. I have no problem with a $1 million exemption for each heir, if each wage earner also gets a $1 million exemption. Then you take the total amount of government spending, collect that much in taxes so you have a balanced budget, and divide those taxes up among wage earners making over $1 million.
7
Lib — I have a question for you. Obviously, we have a government, and it takes money to run the government. (Stuff like wars and corporate welfare aren’t free.) Let’s say it was possible to eliminate taxes on inheritances over $1 million, or eliminate taxes on wages under $35,000, but not both. Which would you choose?
As rich conservatives are fond of pointing out: Wealth creation is not a zero sum game. So, the “strong”, “independent”, “creative” rich should have no problem creating more wealth for themselves — unless they are lying about the zero sum aspect of the money supply. But, why would they lie?
Besides, what could hurt less than a “death tax”? The person who earned the wealth is dead and the tax won’t hurt them. Their heirs will still get plenty of free money, PLUS have the salutory opportunity to flex those rich-guy creative and hard-working genes for more wealth creation: Because, as we all knowTHE MONEY SUPPLY IS NOT A ZERO SUM GAME!
8
Cry me a river, Richard. If I ever have relatives who leave me (and my co-heirs) more than $1.5 million, I’ll cry along with you. I’ve had plenty of practice crying over taxes — I’ve been paying taxes since I got my first job at $1.10 an hour.
What selfish jerks like Richard want to do is shift the entire tax burden to wage earners making $8 an hour, so people with Woodinville estates and Lake Chelan summer homes don’t have to pay a fucking dime.
Hey Richard — news flash — nobody likes paying taxes!!! However, as long as we have people in this country who think spending $1 trillion on “regime change” in shithole countries on the other side of the planet is a good use of our money, somebody has to pay for it. You’ve made it clear you think that “somebody” should be anybody but you and your family.
Like I said before …
F R E E L O A D E R
Insurance money that you inherit is not taxable. You can purchase bonds and such through an insurance policy and the money grows and isn’t taxable.
12
Isn’t it interesting that people who think society needs hereditary wealth and power to keep things from getting too messy always think they’re the people who should have the hereditary wealth and power.
I suppose it’s useless to point out to the uneducated classes (i.e., Republican wannabes) that five centuries of world literature consists in large part of chronicles of lazy, stupid, venal, perverted, and evil artistocrats.
If I say the name : “PUDDYBUD”, he will appear — as if from nowhere — sounding very much like TIM Eyman. I noticed in Tim Eyman’s e-mails that he uses langusge a lot like some of our more virulent trolls.
I’m pretty sure of this.
So much for noblesse oblige, which was never more than a right-wing myth.
How about a compromise? Frank Blethen will feel just a teensy bit guilty about using his paper to shill for repeal of the death tax, right after you feel a teensy bit guilty about using your blog to shill for Graham Hill School.
How about a compromise? Frank Blethen will feel just a teensy bit guilty about using his paper to shill for repeal of the death tax, right after you feel a teensy bit guilty about using your blog to shill for Graham Hill School.
The rich are not morally or intellectually superior to the rest of us. Their shit is the same color as ours. In fact, there is an ample supply of actual historical examples of idle hereditary rich whose wealth and power enabled them to sink into unprecedented depths of moral depravity and social destructiveness.
The Russians had a term for their useless nobility: “Oblomov,” from a famous novel.
“Oblomov (first published: 1858) is the best known novel by Russian writer Ivan Goncharov. Oblomov is also the central character of the novel, often seen as the ultimate incarnation of the superfluous man, a stereotypical character in 19th-century Russian literature. Oblomov was compared to Shakespeare’s Hamlet as answering ‘No!’ to the question “To be or not to be?”. Oblomov is a young, generous nobleman who seems incapable of making important decisions or undertaking any significant actions. Throughout the novel he rarely leaves his room or bed and famously fails to leave his bed for the first 150 pages of the novel. The book was considered a satire of Russian nobility whose social and economic function was increasingly in question in mid-nineteenth century Russia. The novel was wildly popular when it came out in Russia ….”
http://en.wikipedia.org/wiki/Oblomov
So there you are, Richard. You’re promoting Oblomovism in America. Just what we need on top of $2 million birthday parties for CEOs and electricity price-fixers ripping off Aunt Millie. What are you guys going to suggest next, a Tsar? You’ve already instigated an imperialist war, which like the Russian front of 1917, isn’t turning out according to plan.
Well, I don’t want your Oblomovism! In my book, it’s immoral to tax inheritances or capital gains less than wages are taxed. Fuck you! I’m going to vote for Democrats who support a fair system of taxation and a balanced budget, the latter because deficits are paid for with an “inflation tax” that is among the most regressive of all taxes.
I’m still waiting for one of you moonbats to make a coherent moral case as to why someone’s assets should be confiscated by gummint when they die? Why the fuck should gummint get their greedy hands on the money instead of the person’s family?
Moral case please…. I’m waiting…
25
The economy is not a zero sum game, but the distribution of the U.S. economy’s gains of the last 35 years is. Yes, wealth is created from innovation, investment, and risk taking — but it also takes shareholder investment and the labor of employees to build a profitable enterprise. The problem is too few people hogging too much of the fruits of society’s collective economic efforts. Too much is going to capital, not enough to workers. That is shown by the fact that 100% of America’s economic growth since 1970 has gone to the richest 5%.
I meant to say “concentrated capital.” Small shareholders are getting screwed as badly as workers.
I’m still waiting for one of you moonbats to make a coherent moral case as to why someone’s assets should be confiscated by gummint when they die?
Why should other’s taxes be raised so that the wealthy get their taxes reduced?
“The rich are not morally or intellectually superior to the rest of us.”
RR @ 35
Indeed, particularly when we talk about those who have inherited their wealth, history teaches us that the rich are moral slimeballs, a drag on society. They are morally and intellectually inferior to the average citizen. They tend to think they somehow earned their lofty status. I cannot think of any tax that seems to better promote the ideal of a meritocracy, and to promote the capitalist ideals of hard work and persistence, than to tax inheritances. Yet, Republicans (even the 99.5% who will never be touched by an estate tax) scream as if an estate tax is an affront to all that we hold dear. I think we should refer to the estate tax as the “Gilded Aristocracy Tax.” That would be calling a spade a spade.
proud leftist >”…They tend to think they somehow earned their lofty status…”
Sorta like Mr. Bush being born on third base and thinking he hit a triple eah ?
proud leftist >”…we should refer to the estate tax as the “Gilded Aristocracy Tax.” That would be calling a spade a spade.”
Bingo !!!
Hammer hits nail on head
“Many that live deserve death. And some that die deserve life. Can you give it to them? Then do not be too eager to deal out death in judgment. For even the very wise cannot see all ends.” – Gandalf the Grey
What selfish jerks like Richard want to do is shift the entire tax burden to wage earners making $8 an hour, so people with Woodinville estates and Lake Chelan summer homes don’t have to pay a fucking dime.
Commentby Roger Rabbit— 6/14/06@ 12:28 pm
Roger Rabbit is just jealous of a fellow from rural Montana with a high school education, who fought at Pearl Harbor, served 20 years in the military, then another 20 years in a union job at Boeing, who managed to die worth nearly $2 million.
All Roger Rabbit has to show for himself and his law degree is a modest state pension and a house that he has refinanced every two to three years to borrow out every available penny of equity.
By the way, the “Woodinville estate” just sold for $341,000. A lot less I am sure that what Roger’s Rabbit warren in Seattle is worth. But the “Woodinville estate” is debt free. Assuming Roger Rabbit even has title to the house he lives in, I would doubt that more than 15% to 20% of the equity belongs to Roger and Mrs. Rabbit after their latest refinance to pull out equity.
Roger,
If I had my “druthers,” I’d choose neither option and do away with income taxes and replace those with a national sales tax. That way, we’d be able to keep our private financial info (like how much we make)and away from the prting eyes of government (Rep or Demo, it doesn’t matter).
Of course, it would have the side beneift of reducing government power over us. Imagin – no IRS! No tax attorneys! No CPAs making a kiling “filling out government forms” for everyone on April 15th!!
Of coure, I realize the entrenched “professionals” would fight my idea tooth-and-nail. When Steve Forbes came out in-favor of a flat rate income tax during the 2004 New Hampshire primary, H&R Block went crazy advertising against him. That company tried to villify Forbes because he was threatening their rice bowl!
Libertarian, in his/her selfish disregard for civil society, misunderstands reality:
Excellent comments! Had the same situation occur with my ex-father-in-law. The Feds and the state of Massachusetts got about 55% of the TOTAL estate value! The FIVE DAUGHTERS got the remaining 45% and 90% of THAT was retirement funds! So, guess what: the girls have to pay INCOME taxes on the money from the retirement accounts as they withdraw it!!
Idiot, of course the benficiaries of the retirement accounts had to pay income tax on distributions from them. Just as the decedent would have. The accounts are tax-deferred, meaning that the taxes were always going to be paid when the money came out of the accounts.
What a maroon…
Sorry about poor spelling above, but I think everyone gets the idea.
BTW Roger, what would your choice be? Eliminated the estate tax or eliminate income taxes for those with salary/wages <= $35,000?
I’m still waiting for one of you moonbats to make a coherent moral case as to why someone’s assets should be confiscated by gummint when they die? Why the fuck should gummint get their greedy hands on the money instead of the person’s family?
Here let me rephrase that.
“I’m still waiting for one of you moonbats to make a coherent moral case as to why someone’s assets should be confiscated by gummint. Why the fuck should gummint get their greedy hands on the money?”
The point is that either you believe in the power of government to tax, or you don’t. I don’t see an estate tax as any more implicitly immoral per se than an income tax, or a sales tax, or property tax, merely because it involves waiting until the person dies to tax them.
If anything, it’s trivial to make the case that an estate tax is less moral than an income tax, in that taxing a person’s income represents taxing labor that they performed themselves, as opposed to taxing money they receive through an accident of who they were born to. Why should Paris Hilton receive massive tax-free windfalls by winning the genetic lottery, while other people don’t? We’ve seen the sort of damage hereditary aristocracies of wealth have caused in other countries (France pre-1789, Russia pre-1917, many European countries), and America was founded presumably to be a meritocracy. What’s meritocratic about being born a Kennedy or Bush into massive wealth?
RP @ 8
“liberals like Goldy and our fine U.S. Senators from Washington want to repeal the death tax reduction that the GOP passed in 2001”
You make statements very often that are just plain contrary to fact. I’ll assume you are ignorant to avoid imputing malicious motives.
In 2001, the Senate Democrats proposed increasing the estate tax exclusion to $4 million per married couple ($2 million per taxpayer), effective January 1, 2002, gradually increasing to $5 million. The proposal would have “repealed” the estate tax for over two-thirds of the two percent of the estates then liable for the estate tax. That reform is still on the table. The Democrats (and presumably, Goldy) want to “repeal” nothing at all. They just want to block the Congress from extending the estate tax rollback’s expiration, thereby revealing the dishonest Republican shell game that allowed them to say how small the ten-year cost of their tax cuts would be. Once made permanent, the cost in lost revnue to our ogvernment soars.
And as one of our poseters points out, who’s going to pay the difference on the huge unearned windfall that Paris Hilton, Junior Gates, Michale Dell’s kids, Carl Icahn’s kids and all will receive if the tax is eliminated? You. Me. Our children, and their children. Isn’t that the “moral case?”
I say, it’s all income. Capital gains my ass. Tax it as income. Estate tax my ass. Tax it as income. Passive investments my ass. Tax it as income. Same deductions, same tax rates. No ceiling for payroll tax.
28
“Insurance money that you inherit is not taxable. You can purchase bonds and such through an insurance policy and the money grows and isn’t taxable.” Commentby GORDITOS DE LOS ALBERTO— 6/14/06@ 12:30 pm
That’s very nice — for people who can afford to give money to their descendants because they have more than enough for their own needs.
Coward @49 – The money has already been taxed… many times… it belongs to the person who earned it. It’s up to him to decide what to do with it.
What’s immoral is the fact that half the people in this country pay essentially zero taxes while the top 10% do all the heavy lifting. How ’bout we have a flat tax where everybody antes up and pays their share.
In fact, we do all sorts of nice things for people who don’t have to choose between heat and food. The richer you are, the nicer we are to you.
But Reddick the Producer, despite all the nice that comes his way, still turned out to be an asshole who doesn’t pay his gambling debts and whose wife hated him.
31
“If I say the name : “PUDDYBUD”, he will appear — as if from nowhere — sounding very much like TIM Eyman. I noticed in Tim Eyman’s e-mails that he uses langusge a lot like some of our more virulent trolls. I’m pretty sure of this.” Commentby GORDITOS DE LOS ALBERTO— 6/14/06@ 12:36 pm
Fascinating theory! I hope it’s true. I’d hate to think Tim never sees all the nice things we write about him.
Washington state estate tax? Just a means for the few richest families in the state to stick YOU with a $200 billion dollar bill, inexplicably supported by rubber-stamp Republicans who will never pay estate tax in the first place.
What’s immoral is the fact that half the people in this country pay essentially zero taxes
Sigh.. Bullshit.. This has been debunked so many times…
Economic Genius @38
For the same reason Nordstrom’s confiscates your money at the cash register when you walk out of the store with a pair of their shoes.
If fucks like you want to fight wars, put them on your own damn credit card. When you try to make me pay for it, you’re nothing but an identity thief.
What selfish jerks like Richard want to do is shift the entire tax burden to wage earners making $8 an hour, so people with Woodinville estates and Lake Chelan summer homes don’t have to pay a fucking dime.
Commentby Roger Rabbit— 6/14/06@ 12:28 pm
More to the point, what these selfish jerks want to do is shift the responsibility for paying off the MASSIVE debt created by the their Corporate supported wars and corruption, subsidies to corporations, and natural resource give-aways. They want to have their lunch, eat it, and then have someone else pay for it.
All of America was getting financially stronger and growing in the late 50s with a very high corporate income tax and high estate tax. As far as I can tell the arguments that brought down those taxes were all poorly supported ideology. The result, now in America only the top 1% to 5% of the people are getting financially stronger.
coward, I think you missed the rednecks point and managed to buy into his attempt to change the conversation. You said “merely because it involves waiting until the person dies to tax them.” You will note, until he asked someone to defend taxing people on death, noone proposed doing so. We might as well be asking him to give us a moral justification for locking women between the ages of 18 and 35 in tiny boxes for breeding purposes, noone is suggesting taxing someone at death and noone ever has.
This is about taxing unearned income, and the wording of the question is on par with asking someone if they have stopped beating their wife.
The pertinant question that noone is asking here is what is your moral justification for aquiring up to a million in a half in assets without paying the taxes that everyone else does as they aquire assets? In this country, we pay taxes anytime money or assets change ownership. We diferentiate between that which is earned and that which just falls into someones lap like with capital gains or inheritance and charge more if a person didnt have to do anythingg to get the asset.
So why, morally, is a small group of individuals being allowed to not pay any taxes on something the rest of us pay on regularly?
Of course, just a suggestion, I wouldnt respond to the redneck in the first place, he isnt capable of following any arguement longer than 3 steps, and really doesnt seem to know when he has lost an arguement.
59
But what can I expect for a welsher who won’t even pay a measly $100 gambling debt?
How ’bout we have a flat tax where everybody antes up and pays their share.
Because the flat tax is an unfair tax. A cut for the rich and an increase on the poor.
I wonder how much the taxpayers spent on courts, judges, cops, and enforcement officers making Reddick to pay the $500,000 he owed his ex and kid? Whatever it cost, I’ll gladly pay taxes for it.
63
I think we’re already past the point where a flat tax would increase taxes on the rich and reduce taxes for the poor.
The money has already been taxed… many times… it belongs to the person who earned it. It’s up to him to decide what to do with it.
My income is taxed, and then I go pay my property taxes on my condo. Whoops! Double taxation.
Again…you’re bringing up an essentially irrelevant point. We have N dollars we want to raise by taxes, how do we do this? Part of the way is estate taxes. So why is letting people get millions of dollars for free by accident of birth a good idea in a meritocratic and democratic society that supposedly doesn’t believe in hereditary classes? Should we go whole hog and bring back British-style titles of nobility, too?
What’s immoral is the fact that half the people in this country pay essentially zero taxes while the top 10% do all the heavy lifting. How ’bout we have a flat tax where everybody antes up and pays their share.
Uh, no. Show me an instance where poor people don’t pay sales taxes.
As for what “their share” is, wealthy people benefit the most from a system of government that protects their claims in property by things like laws, enforceable contracts jails, and so on. It’s rather Hobbesian (because it basically uses the force of the state), but it’s certainly true- even Adam Smith and Teddy Roosevelt recognized that.
Also note that Adam Smith suggested that one source of tax revenues should be levies on luxury items (the other was a tax on ground-rents). Even the patron saint of capitalism didn’t want to make poor people poorer.
49
“What’s meritocratic about being born a Kennedy or Bush into massive wealth?” Commentby eponymous coward— 6/14/06@ 1:51 pm
It’s worse than that. We now have a hereditary presidency.
46
“If I had my “druthers,” I’d choose neither option and do away with income taxes and replace those with a national sales tax.”
Commentby Libertarian— 6/14/06@ 1:39 pm
Yes, you’d like that, wouldn’t you? Replace our current tax system with the most regressive tax of all. Rest assured you won’t get my vote for that.
46 (continued)
CPAs, tax attorneys, and H & R Block are a sideshow. There are three questions here: How much should government spend, what should it spend it on, and how should the money be raised?
Republicans and Libertarians came up with wrong answers for all three of those questions.
We might as well be asking him to give us a moral justification for locking women between the ages of 18 and 35 in tiny boxes for breeding purposes, noone is suggesting taxing someone at death and noone ever has.
And my argument is “So what if I grant his rhetorical point? Big deal.” I just don’t feel any “OH NOES!!! SOMEONE DIED!!!! WE CAN’T HAVE A TAX NOW!!!!” about the issue. So we defer taxes on property you acquire until after your death, instead of charging you more while you live. OK… so explain why we need to eliminate a tax at a time when the budget’s screwed up AND it only impacts about 2% of the population (mostly the superwealthy)?
I’d be fine with treating money you get from an estate and money you get from cap gains the same as money you get from income, though…all taxed under the same rules.
I would spend less money than Bush, and collect more taxes — my budget would balance, and we would have low inflation.
I would not shortchange defense, but I would redirect billions away from a useless foreign military adventure, corporate welfare, and crony contractors to the domestic needs of our own citizens. More veterans would be eligible for VA health care, and I would raise combat pay for active duty personnel. I would spend enough money to inspect 100% of the containers coming into U.S. ports for radiological materials, and to provide all of the nation’s first responders with communications equipment that enables them to talk with each other. In the event of a natural or man-made disaster, there would be food and drinking water for survivors within hours, not weeks.
I would not levy confiscatory taxes, or use the tax cut to restructure society. I would adopt a tax cut that does not destroy the profit motive to invest, invent, and produce. However, my tax code would not contain special breaks or privileges based on campaign contributions, politics, or favoring some groups at the expense of others.
Yeah, Roger, you and I disagree on pretty much everything when it comes to taxes. So what else is new?
BTW, nobody is stopping you from sending the govennment (local, state, federal – take your pick) extra money. They’ll take it. Don’t be so quick to criticize those of us who’d prefer to keep what we earn, but you can do whatever you’d like to do with your wealth.
mostly because it wouldnt make much sense under our current (federal) tax structure. With very few loopholes, we tax wealth transfer at the time of the transfer. If we set that to charging part of it at the time of transfer and part at death, then someone could potentially avoid taxes by spending money due. While this would be a progressive tax, I can’t think how you would ever sell it as a legitimate tax plan.
How about a 100% estate tax, with an exemption for decedents who die with dependents or spouses? Then, we’d see the true cream rise to the top. Rich kids would still get a head start, but everyone else could at least see the starting line. Moreover, the increased revenue would permit us to eliminate many of the taxes that burden us while we’re living. Such a tax scenario would seem most consistent with the notion of a meritocracy.
Historically, federal spending ranged from 18% to 22% of GDP except during major wars. State and local government spending holds fairly steady at roughly 15% of GDP.
Because government spends roughly 35% of national income, the average American must expect to pay roughly 35% of their personal incomes to government. Whatever amount they do not pay as overt taxes, they will pay as “inflation tax.”
If you don’t want to pay 35% of your income to government, then we have to cut government spending. The obvious place to cut is large discretionary expenditures, such as optional wars and the $700 billion giveaway to the pharmaceutical and insurance industries. The hundreds of billions spent on weapons systems (such as the nonfunctional ICBM interceptor) is another item that will have to come under the knife if we want to get serious about getting government spending below 35% of our incomes.
One of the best ways for a business to spend less is by becoming more efficient. There is a huge opportunity to improve the efficiency of our economy by doing something about our costly, antiquated, and ineffective health care delivery system. The private sector has had 100 years to make this system work, and is failing miserably. That doesn’t mean moving health care from the private sector into the governmental sector is necessarily the answer. But we can reduce the financial burden of health care on the average American family by hundreds, if not thousands, of dollars a year by scrapping our current failed system and replacing it with something better. It would not be hard to do — in fact, it would be hard to design a health care system that is worse than the one we have.
72
“Yeah, Roger, you and I disagree on pretty much everything when it comes to taxes. So what else is new?” Commentby Libertarian— 6/14/06@ 2:27 pm
If the FREELOADERS starting agreeing with me, I would immediately re-think my positions.
started, not starting
Do you know any FREELOADERS?
45
“By the way, the “Woodinville estate” just sold for $341,000. A lot less I am sure that what Roger’s Rabbit warren in Seattle is worth. But the “Woodinville estate” is debt free. Assuming Roger Rabbit even has title to the house he lives in, I would doubt that more than 15% to 20% of the equity belongs to Roger and Mrs. Rabbit after their latest refinance to pull out equity.
Commentby Richard Pope— 6/14/06@ 1:38 pm
Actually, about the same. Market value around $380,000 but it needs repairs we can’t afford. After subtracting work orders and paying off the mortgage, we would walk away with $300,000, not that it’s any of your business. In other words, about 10% debt and 90% equity. If it was 80% debt and 20% owner equity, I couldn’t have retired. My utility bills are bigger than my mortgage payment.
Yes, Richard, I’m one of those rabbits Reddick waxes eloquent over — I worked hard, spent less than I made, paid off debt and invested … and paid a hell of a lot of taxes. And wore the uniform and risked eating hot lead, too — back when another Republican president was fighting a useless war for a lost cause that produced nothing of benefit for the American people or the world.
“I’d choose neither option and do away with income taxes and replace those with a national sales tax.”
Of course, you do realize a national sales tax that could pull in the 20% of GDP it would need to cover current government activities would be something like a 50% rate, right?
And before you say “Oh, but we’ll just cut…”- defense + Social Security + Medicare + Medicaid + stuff like federal pensions that we CANNOT immediately turn off tomorrow without huge, massive economic problems (like millions of retirees being out in the streets) makes up 80% of current federal government expenditures. So you can’t cut your way out of a huge amount of sales tax that would be a massive incentive to have a black market, which would mean the sales tax wouldn’t bring in enough, which means a tax increase, which means…
Read Bruce Bartlett on the subject if you think I’m kidding.
http://www.nationalreview.com/.....090847.asp
Bruce Bartlett, by the way, helped write the Kemp-Roth tax cuts of 1981. You know, the ones St. Ronnie signed into law? So he’s no liberal.
Yeah, yeah, I know what some of you trollfucks are going to say — that was JFK’s and LBJ’s war. Well, let me just counter that by pointint out:
1. The U.S. involvement in Vietnam was started by Eisenhower, a Republican.
2. It’s true that LBJ, a Democrat, made the critical decision to commit ground troops; but his Republican successor, Nixon, kept the war going for 4 more years after it was already a lost cause, and 2/3rds of the casualties occurred on Nixon’s watch.
78
Show me a Republican, and I’ll show you a FREELOADER.
Sure, I know freeloaders. I have lots of Republican friends.
“But few people can withstand incessant ranting of talk radio and sometimes rabid musings of the blogosphere, not to mention heavy-handed political posturing from the County Council.”
Notice how it’s always true that blathering right wing talk show hosts, barely sane right wing bloggers (Shark), and populist “reformer” politicians always seem to have the thinnest skin of all?
In fact, none of the band of ideologues who helped drive Dean Logan out of town would have lasted a day under the same amount of harrassment. Not like any of them would ever be in a position of responsibility for anything beyond chief poop-tosser, anyways.
Memo to Richard Pope: You don’t pay estate taxes on $341,000.
84
“barely sane right wing bloggers (Shark)”
After Stefan’s rant about Goldy’s show, it’s debatable whether he still qualifies for “barely sane.”
70
“I’d be fine with treating money you get from an estate and money you get from cap gains the same as money you get from income, though…all taxed under the same rules.” Commentby eponymous coward— 6/14/06@ 2:16 pm
Absolutely. Flat tax. Tax treatment is identical regardless of whether the income comes from work, inheritance, cap gains, or the lottery.
I work about 50 hours per week in a stressful job, so I don’t consider my self a FREELOADER.
With that said, what I want first and foremost in taxes is:
1. Simplification
2. Simplification
3. Simplification
The current code is too complex and only benefits accountants and lawyers. Time to simplify everything.
Notwithstanding all the teeth-gnashing over high real estate prices, my warren is worth only twice what a paid for it many years ago, and today’s dollar is worth only half as much, so in real money I haven’t made a cent from appreciation. The $380,000 market value of my burrow, no matter how much hardship that amount might inflict on a buyer, is the minimum I’d have to get just to break even.
88
“With that said, what I want first and foremost in taxes is:
1. Simplification
2. Simplification
3. Simplification
The current code is too complex and only benefits accountants and lawyers. Time to simplify everything.” Commentby Libertarian— 6/14/06@ 2:53 pm
Well, hell! There you go, Libertarian, and say something I agree with. How did that happen?
Actually, I file the 1040 short form. My affairs is simple: Damned little income, even fewer deductions, and no tax credits at all.
are, not is … my affairs are simple
I’m typing fast because Mrs. Rabbit is going to expropriate the computer in 2 minutes and 49 seconds.
(crashing noises in background)
Attention, bloggers. Mr. Rabbit is now off-line.
Attention, bloggers. Mr. Rabbit is now off-line.
Commentby Mrs. Rabbit— 6/14/06@ 2:58 pm
Thank you Jesus!!!!
As to people having “already paid taxes” on the money they leave in their estates – um, no, in most cases, they have not. It is unearned income in most cases; it is caused by either increases in property value or inflation, and neither of those are taxed as income. The estate tax is nothing but a way to defer payment of taxes on the value of property until it is either sold, or the owner passes it on to their heirs.
I fail to see in what way some nimrod whose grampa died and left them $2 million is somehow being victimized because they “only” inherit a million bucks. Speaking as someone who’ll be lucky to inherit some old photos and a rusty bucket, I’d be overjoyed to pay taxes on a $2 million estate.
The Democrats did drop the ball on this one and let the Repukes frame it to their advantage by not raising the exemptions regularly as local property values and inflation grew. They’ve done that now, but too late to prevent the Blethens of the world from using this to drum up outrage among the very people for whom this has the least impact. (The vast majority of people who oppose the estate tax will never inherit an estate large enough to pay taxes on, and don’t seem to understand that they will pay taxes somewhere ELSE if we stop taxing the estates left to the likes of Junior Gates. The money has to come from somewhere, and if it isn’t coming from DEAD people whose estates were worth over $2 million, it’s going to come from those of us ordinary schmucks who are lucky to be able to leave our kids a used Ford pickup.)
I say let all those rich and famous people who think that estate taxes are just peachy-keeno ouhgt to simply leave their wealth to the government.
I’ll take Bill Gates’ dad seriously when he leaves his entire estate to the Feds.
Absolutely. Flat tax. Tax treatment is identical regardless of whether the income comes from work, inheritance, cap gains, or the lottery.
Flat taxes have problems (like seriously shifting the burden of taxes away from the wealthy). I don’t have issues with a progressive income tax with minimal, well-defined exemptions + earned income tax credit for families (like Max Sawicky’s Universal credit detailed here: http://www.maxspeak.org/Op-eds.....d(1-15-01).htm )
Simplification is fine (less loopholes = lower overall rates), but the reason we tax rich people more is they have more money and they reap the benefits of a system where property and wealth acquisition is protected, and we’re not interested in making working poor people poorer who don’t reap those benefits by increasing their tax burdens.
Oh, and more here:
http://www.epinet.org/content.cfm/sfc
“Tax simplification
The SFC replaces approximately 200 pages of instructions, worksheets, forms, and tables in the current tax code with this postcard-sized form.”
Whatever happened to private property? You lefties here talk as if the money belongs to “the people”. It doesn’t. It belongs to individual citizens.
You can tell the fairness of a tax by the amount of effort that is spent avoiding it. At this point, the Gates klan and Paris Hilton have paid expensive lawyers to avoid ever paying any of your schemes. There have been estimates that as much is spent creating shelters from the tax than the tax collects. What a waste – but isn’t one of the heirs of H&R Block sitting in congress as one of the richest men in the country?
Eliminate the step up valuation at death, and heirs just pay the same capital gains tax on assets that would have been paid by the original earners. THat will take “death” out of the equation all together. AND eliminate this whole foundation stuff that pays the Gates family to work on the dole, but avoids paying the taxes they want to wage on everyone else.
What the hell? Someone is going to have to pay the bills and if Repubclicans can’t handle the responsibility then lets get some adults in charge.
You can’t have your cake and eat it too you dumb fucks! Learn to pay the bills or get out. Bankrupting our children so Paris Hilton can buy a second (third) fucking yacht doesn’t do the country a damn bit of good.
Commentby Nindid— 6/14/06@ 11:06 am
Nindid we have lots of money your local taxes are paying for you kids to learn new math to pay your bills. Don’t blame the rich because you vote Socialist Democrats into office and can’t do their job.
From the seedy town of Alachua, Florida, comes an incredible tale of corrupt Republicans running a police state in which the police commissioner counts ballots and a Democratic candidate was jailed for requesting public records and attending city council meetings.
http://www.rawstory.com/news/2....._0612.html
Commentby Roger Rabbit— 6/14/06@ 11:59 am
Roger it looks like Dean Logan gave the instructions on how to run an election. What your problem? They ran it just like King County and your friends been doing for years. Remember Al Gore keep counting the vote untill you win.
15% of every tax dollar goes to pay interest on the national debt. Guess who owns most of those government bonds.
Hint: It’s not “welfare queens”.
Commentby GORDITOS DE LOS ALBERTO— 6/14/06@ 12:09 pm
You are right it’s Roger Rabbit and all his rich lawyer friends.
“Many that live deserve death. And some that die deserve life. Can you give it to them? Then do not be too eager to deal out death in judgment. For even the very wise cannot see all ends.” – Gandalf the Grey
Commentby daCascadian— 6/14/06@ 1:34 pm
Just what we need is a dreaming Cascadian quoting Lord of the Rings and expects the rest of us folks to live in his dream world. Hollywood is still making large sums of money making movies that you believe is the gospel.
http://en.wikipedia.org/wiki/Gandalf
The rich are not morally or intellectually superior to the rest of us. Their shit is the same color as ours. In fact, there is an ample supply of actual historical examples of idle hereditary rich whose wealth and power enabled them to sink into unprecedented depths of moral depravity and social destructiveness.
Commentby Roger Rabbit— 6/14/06@ 12:39 pm
Maybe Roger they learned something better than new math and were willing to take risk and earn the success. Remember you went to that class on Dare to Be Great and look at you now a poor rabbit lawyer. Now if you went to a school that did not teach that new math you could be rich today like John Kerry.
john kerry is rich because he married a rich hog.
Okay, I skipped to the bottom, so forgive me if I’m making a point others made above.
One of the things to remember is that the estate tax has a relationship to the income tax. A person who accumlates capital gains and does not cash out of those assets has avoided paying taxes on that appreciation during his or her lifetime.
So, you say, not problem, the estate will be taxed for capital gains when the assets are sold, right? If I remember my tax classes correctly, the answer is: YES, the estate will have capital gains taxes if the assets are sold; but NO capital gains if the assets are not sold, but distributed directly to the heir. If the estate transfers the stocks, bonds, or real property directly to the beneficiary, then there is not capital gains recognized by the federal government. Instead, the heir (or charitable donee) takes the property on a “stepped up” basis – meaning that their capital gains calculation will begin at the point they receive the capital assets. The appreciation on the capital assets between the time the decedent purchased it, and the time it is distributed to its heirs, is NEVER SUBJECT TO A FEDERAL INCOME TAX!!!!!!
Now this makes some sense if you understand that the estate itself may be taxed, based upon its total value, less exemptions. But if you remove the estate tax, then you suddenly have not only eliminated the estate tax, but you have also eliminated ANY TAX upon that income.
Now, as for Richard Pope’s proposal that the tax be allocated based upon the number of beneficiaries. Alas, the problem with that is that any smart tax lawyer will simply multiply the number of beneficiaries. Instead of giving directly to the children, how about making a hundred trusts, each receiving 1/100th of the estate, with the beneficiary the children, grand-children, and great-grandchildren of the beneficiary? Estate planners already engage in generation-skipping tax schemes, so this isn’t any great jump to contemplate. In effect, what Richard Pope is proposing is a rather significant change in the concept of the inheritence tax. Instead of taxing the estate, we tax the individual receiving the inheritance. That would take a lot of thought to avoid some unintended consequences.
rhp6033
I pay capital gains on money that is invested and isn’t “cashed out.” My father has paid capital gains taxes for years on investement income……. maybe you haven’t been figuring out your taxes correctly.
“Sorta like Mr. Bush being born on third base and thinking he hit a triple eah ?”
Quoted by somebody, above. I really like that analogy. It pretty much sums up what I took several paragraphs to say in an earlier post, pointing out that most people who are rich are rich because they are lucky, not smarter or harder-working than everyone else.
As for myself, I must confess some personal prejudice on the estate tax issue. My father grew up during the depression, did two tours in the military (post WWII and again during Korea), and had war-related medical problems thereafter, and died at age 45 (when I was 16). My mother inherited the rather meger estate (one small house, two cars, no savings after medical expenses). She worked as a schoolteacher, but developed cancer and died herself at age 56, leaving an estate consisting of the same house, and the same car, she had when my father died. Once we sold the house, furnishings, and car, and paid off the uninsured medical expenses (she was in the hospital for four months), my sister and I split the estate between us. We each got a check for a little less than three thousand dollars. I also got the china set, my sister got the piano, and we split the family pictures.
So when I hear people crying about how unfair it is that they will only receive an inheritance measured in the hundreds of thousands of dollars, or even the millions of dollars, I think of my own hard-working parents, and I say… GIVE ME A BREAK! Maybe most of the views on this issue are a result of personal experience, and I will concede that my own experience creates a biased viewpoint. But since my wife and I both had to work our way through college and graduate school without any help from our families, the argument that somehow others somehow are “smarter” or more “hard-working” and therefore deserve to not be taxed on what is essentially a windfall (to them), rubs me the wrong way.
To: sgmmac at 109:
You don’t pay capital gain taxes until you “realize” the gain. Just because the price goes up or down in the interim, it doesn’t matter, it is not a reportable event. If your tax accountant is making you report taxes on gains when you haven’t sold the stock, then maybe its time to change accountants. If you sold the stock (or other capital asset), then you DO need to report it and pay capital gain taxes on the income. It works the same way for an estate – they have to sell the stock in order to “realize” the capital gain.
It gets more complicated with mutual funds. If the mutual fund sells stocks and the gains are not offset by corresponding losses on other stocks, you can get a notice at the end of the year that requires you to pay taxes on your share of the capital gains. This doesn’t affect people in 401(K) plans, because the capital gains are supposed to be rolled over and not taxed until the distribution (presumably at retirement). But with other mutual funds, this can be an unpleasant surprise for some people. I think Fidelity Magellan just cashed out on a lot of capital gains, and a lot of people are going to be surprised with tax statements at the end of the year.
A tax tip: Consider charitable donations of capital assets which have appreciated significantly. If you give the property to a charity, they take it on the “stepped-up” basis, and wouldn’t have to pay taxes on it anyway. But you get to deduct the market value of the property as a donation. Example: You bought a rental house at 100K, now it is worth 500K. Your capital gains are 400K (at 15%, a 60K tax liablity). But you have been taking equity out of the house in the form of re-financing, and now owe 450K. If you sold the house, paid off the bank, and paid capital gain taxes, you would actually owe 10K to the IRS, plus the cost of the sale. However, if you donated the property to charity, you would receive a tax deduction of the 50K in equity against your regular income, and never be taxed on the capital gains. Instead of owing 10K in additional taxes (plus the cost of sale), you get a tax deduction worth 7K to 19K in cash, depending upon your tax bracket.
sgmmac:
I pay capital gains on money that is invested and isn’t “cashed out.” My father has paid capital gains taxes for years on investement income……. maybe you haven’t been figuring out your taxes correctly.
Not just a wingnut, an incredibly misinformed wingnut (I know, I know … I’m being redundant).
Simply put, this is absolutely, completely, totally wrong. As long as an investment is held, whether it’s stock or a mutual fund or a home, the capital gains are unrealized and untaxed. Capital gains taxes are due only when the assets are sold.
The taxes being paid while the asset is held are on the distributions thrown off by the investment — dividends, usually, but also interest at times. Even when a mutual fund makes a “capital gains distribution”, it’s actually distributing the capital gains it has earned by selling its investments, not your capital gains. Those distributions are defined as dividends for you.
Sheesh, it takes a liberal to explain this stuff to wingnuts.
N in Seattle: Maybe “sgmmac” is just being confused by the difference between a taxable event such as a sale, and being “cashed out”, as he termed it. If a sale occurs and the funds are kept in his brockerage account, it is a taxable event even if he doesn’t withdraw the funds. However, if he keeps the same stock and doesn’t sell it, then it isn’t a taxable event.
But I wonder if his stock broker (and his father) are churning the account, to keep creating such taxable transactions? Or perhaps he should be looking at like-kind exchanges, instead?
Correction: I meant that perhaps his stock broker, and his “father’s stock broker”. I didn’t mean to imply that his father was churning his account.
rhp6033 — If the broker’s churning, perhaps someone needs to be looking at wash sales. Especially if, as sgmmac implies, the account ends up with the same number of shares of the same stocks.
I suspect the real answer is that sgmmac doesn’t have a clue what he/she is babbling about.
Simply put, this is absolutely, completely, totally wrong. As long as an investment is held, whether it’s stock or a mutual fund or a home, the capital gains are unrealized and untaxed. Capital gains taxes are due only when the assets are sold.
Commentby N in Seattle [N in Seattle..Not true. Mutual fund long and short term gains as well as dividends are taxed each year unless held in a “qualified” retiremnet account. Reinvestment is not an issue.
If you want to delay taxes, buy bonds.
Tax cap gains at 110% of ordinary eaarnings. Make JCH do some work for a change.
Maybe most of the views on this issue are a result of personal experience, and I will concede that my own experience creates a biased viewpoint. But since my wife and I both had to work our way through college and graduate school without any help from our families, the argument that somehow others somehow are “smarter” or more “hard-working” and therefore deserve to not be taxed on what is essentially a windfall (to them), rubs me the wrong way.
Commentby rhp6033— 6/14/06@ 5:10 pm
Rhp my total windfall after my mother died was $18.00 and we didn’t have a pot to piss in or a window to throw it out off. I still believe if you earned the money you have every right to give it to anyone to spend any way they want. The government is in everybody’s pocket and do not need my resources. If you think the government is so poor donate your money to them so they can squatter it away.
rhp6033,
Mutual funds, a very popular investment for the middle class, pass on capital gains to their investors each year, assuming they had gains for the year. The mutual fund shareholders are subject to income taxes on those gains even if they do not actually receive the cash unless they’ve instructed the mutual fund company to cut them a check for the gains. Same thing applies for interest and dividneds received by the mutual fund.
Capital losses a mutual fund experiences, however, cannot be passed on to the shareholder. In order to take advantage of the decline in value, the shareholder must liquidate the entire position to show the loss. Even then, a longtime investor in a mutual fund isn’t likely to show much of a loss, given the performace of the market over the past 20 or 30 years.
In any event, as the mutual fund holder pays taxes on the capital gains and other income from the mutual fund, his or her cost basis in the entire fund increases. This hopefully leads to a lower overall tax burden for the shareholder once he or she liquidates the entire position.
Yes, Libertarian and the asshole who calls itself those inane names, mutual funds pass along their capital gains to their investors. As I said earlier, those aren’t your capital gains … they’re the gains resulting from the fund managers’ decision to sell assets, the fund‘s capital gains. You receive those gains as capital gains distributions, which are taxed as dividends.
So you don’t like Libertarians. There’s a news flash! Every liberal who comments on this blog hates Libertarians. Libertarians believe in individual freedom and individual responsibility. Most liberals seem to be OK with the individual freedom part but miss the bit about individual responsibility.
My brother is a classic example. He blames the big corporations for not having anything other than social security for retirement. Never mind that he cashed-in his company retirement plan every time he needed some extra money to buy a new car or whatever. Now, nearly 40 year later, he’s up the creek without a paddle, yet it’s big business’s fault. Give me a break!
The problem is that the country is full of dolts like my brother.
Libertarian:
If there is one thing the Bush II years have made very very clear, it is that when push comes to shove the vast majority of self-described “libertarians” will meekly support and/or accept expanded militarism, pro-corporate corruption and social control of the individual, and the police state apparatus that goes along with it.
Not much respect left for the libertarians outside their little group of “rugged individualists.”
rhp6033,
To further clarify, I get an IRS form every year from my Dad who gets it from his tax accountant. The form lists all activity from the limited family partnership that he created a few years ago. It lists all kinds of things, capital gains, capital losses, foreign taxes, interest in oil investments, etc, etc, etc….. He owns stocks, bonds, mutual funds and whatever else.
I take that form and put all of the info into Turbo tax and my taxes go up dramatically. Turbo Tax spits out a half a dozen different schedules to attach to my 1040. One of them is Capital Gains and another is Capital losses, I don’t get to declare those though.
I was not referring to the growth of stocks as capital gains. The assumption that people who own stocks never pay any taxes on it is wrong. My Dad pays the IRS estimated tax payments every quarter. and he has for years. When you sell stock you pay capital gains on the growth of the stock and broker fees. When you die, you pay the IRS capital gains for those stocks sold. If stock is transferred, you broker fees and capital gains, unless it’s a gift.
I think capital gains taxes are too high, but I’m up for reasonable taxes. What isn’t reasonable about the death tax is the taxes on PROPERTY. You should not have to liquidate everything to pay the FEDS and the State when your family member dies.
Roger has some good ideas on it.