Death Taxes

[Lefty Scaevola]

Originally posted by Ramo
Why should income derived from work be taxed, while income inherited be untaxed?

It was already taxed as income when the first guy earned it, and inheritance or gift to your faminly is not defined as "income" by any accounting standard or law. So if taxed, it is taxed under something other than income tax.

[Elok]

Originally posted by Caligastia
Why shouldn't I be allowed to pass on my wealth to my children?

Who says you can't? You just can't pass on all of it.

[lord of the mark]

lets be frank.

Except for untaxed Capital gains, inheritance taxes are double taxation. Thats not comparable to taxes on salaries, since the corp inc tax is tax on profits, from which salaries are excluded.

It IS equivalent to double taxation of dividends. Which most economists think is a pretty poor idea.

But why shouldnt we double tax inheritances? Inheritance represents a source of social power, that reduces mobility in society. If the people decide that thats a bad thing, (and I tend to think it is) they can of course tax it.

The main reason to not excessively tax income is to avoid creating a disincentive to earning it. Will taxing its passing via estates have the same impact on earning activities? Maybe it will, maybe it wont. Thats an empirical question, and if one believes it wont, it could make a lot of sense to tax inheritance.

[Nugog]

Originally posted by Elok


Who says you can't? You just can't pass on all of it.

But why should we not be able to?

If we have saved , invested etc - then there are taxes on all earnings from that anyway (down here at least) - surely removing Death Tax would encourage people to save............

[lord of the mark]

Originally posted by Nugog


But why should we not be able to?

Cause the people decided the benefits from taxing you exceed the costs.

When they decide otherwise, you will be able to.

This aint rocket science.

[Dauphin]

Originally posted by Whoha
In that scenario you'd be able to pass on 500k untaxed. Why does it matter though which half was spent? if it was spent that means taxes were almost certainly paid on purchases.

It makes a whole world of difference in accounting terms, especially in terms of money laundering.

[Dauphin]

Originally posted by lord of the mark
Except for untaxed Capital gains, inheritance taxes are double taxation. Thats not comparable to taxes on salaries, since the corp inc tax is tax on profits, from which salaries are excluded.

It IS equivalent to double taxation of dividends. Which most economists think is a pretty poor idea.

Not quite equivalent.

If income was taxed at 30%, corp tax at 10% and dividends at 10% then paying someone via dividends results in a lower tax burden. Adjust the rates and the alternate taxation would be preferable. (I am thinking owner managed business here).

Inheritance tax cares not how you got your money, earnt, saving income, dividends or other and when it double taxes you there is no alternate single taxation route. Unless you want to gift it away before you die (but there are taxation implications there too).

[Whoha]

Originally posted by Dauphin


It makes a whole world of difference in accounting terms, especially in terms of money laundering.

So what are they doing? giving money to a family member of the intended recipient, having that person change his will, and then offing him?

[snoopy369]

Inheritance taxes are one of the few things i'm quite left of center on. I believe that inheritance should be highly taxed, above a certain level; think 75% to 90% over $1m.

Why? Because I think that this would improve the economy (encourage spending rather than saving late in life, as compared to early in life; increase spending in the economy, improving business). Because I think that the greatest threat to the Liberal (big L) way of life is an aristocracy, and our current inheritance tax laws encourage aristocracy (by encouraging the accumulation of wealth, and guaranteeing that the number of people holding the nation's wealth will continuously decrease). Because I think that getting rid of the morons who control way too much money without working a day in their lives and without having an ounce of brains in their head in any other way would probably be considered illegal.

I'm well aware that, unfortunately, certain people (well, everyone) would immediately take their money offshore. Fortunately, I have a solution to that too 90% (or some number higher than the inheritance tax) tax on money over $1m (per decade) entering the USA from overseas and not exchanged for goods directly. Might play havoc on the stock market, but at this point it wouldn't matter much anyway, right?

(Yes, I'm aware that both of these are fairly impractical to bordering on maniacal; but what's the point of talking about things if you don't go to the extreme, right? )

[Pekka]

death taxes are immoral.

[Dr Strangelove]

Speaking of which, in the Lynchburg newspaper this weekend we were informed that Liberty University's entire debt was being paid off by Jerry Falwell's life insurance, a princely sum of $32 million.

This causes me to wonder, what sort of premium would a person have to pay to buy a $32 million life insurance policy. I'd assume that the policy was taken out 25 to 30 years ago, but still, wouldn't the premium run a couple hundred thousand / year? Where did the money come from? Was it taxed? Even if it ( the premium ) was a gift wouldn't it still be taxable?

[Nostromo]

Originally posted by snoopy369
Inheritance taxes are one of the few things i'm quite left of center on. I believe that inheritance should be highly taxed, above a certain level; think 75% to 90% over $1m.

Why? Because I think that this would improve the economy (encourage spending rather than saving late in life, as compared to early in life; increase spending in the economy, improving business). Because I think that the greatest threat to the Liberal (big L) way of life is an aristocracy, and our current inheritance tax laws encourage aristocracy (by encouraging the accumulation of wealth, and guaranteeing that the number of people holding the nation's wealth will continuously decrease). Because I think that getting rid of the morons who control way too much money without working a day in their lives and without having an ounce of brains in their head in any other way would probably be considered illegal.

I'm well aware that, unfortunately, certain people (well, everyone) would immediately take their money offshore. Fortunately, I have a solution to that too 90% (or some number higher than the inheritance tax) tax on money over $1m (per decade) entering the USA from overseas and not exchanged for goods directly. Might play havoc on the stock market, but at this point it wouldn't matter much anyway, right?

(Yes, I'm aware that both of these are fairly impractical to bordering on maniacal; but what's the point of talking about things if you don't go to the extreme, right? )

You're evil, you know that?

[Odin]

The proper term is "Estate Tax." "Death Tax" is a right-wing frame, kind of like "pro-life."

IMO people should be allowed to inherit no more than $1 million. An aristocracy of those who inherited ungodly amounts of wealth is indefensible, immoral, and contrary to democratic and meritocratic principles.

[Odin]

Originally posted by snoopy369
Inheritance taxes are one of the few things i'm quite left of center on. I believe that inheritance should be highly taxed, above a certain level; think 75% to 90% over $1m.

Why? Because I think that this would improve the economy (encourage spending rather than saving late in life, as compared to early in life; increase spending in the economy, improving business). Because I think that the greatest threat to the Liberal (big L) way of life is an aristocracy, and our current inheritance tax laws encourage aristocracy (by encouraging the accumulation of wealth, and guaranteeing that the number of people holding the nation's wealth will continuously decrease). Because I think that getting rid of the morons who control way too much money without working a day in their lives and without having an ounce of brains in their head in any other way would probably be considered illegal.

I'm well aware that, unfortunately, certain people (well, everyone) would immediately take their money offshore. Fortunately, I have a solution to that too 90% (or some number higher than the inheritance tax) tax on money over $1m (per decade) entering the USA from overseas and not exchanged for goods directly. Might play havoc on the stock market, but at this point it wouldn't matter much anyway, right?

(Yes, I'm aware that both of these are fairly impractical to bordering on maniacal; but what's the point of talking about things if you don't go to the extreme, right? )

[Wycoff]

Originally posted by lord of the mark But why shouldnt we double tax inheritances? Inheritance represents a source of social power, that reduces mobility in society. If the people decide that thats a bad thing, (and I tend to think it is) they can of course tax it.

QFT