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George Steinbrenner and estate tax insanity

George Steinbrenner's well-timed death -- though I suspect he may not have seen it that way -- points up the insanity of the current estate tax situation. As The Post and Katrina vanden Heuvel have noted, the billionaire Yankees owner could end up owing no federal estate tax -- because there is no federal estate tax this year.

Last year, Steinbrenner's heirs would have faced a tax rate of 45 percent on the bulk of his estate. Next year, the tax is set to spring back to a 55 percent rate. Congress is not going to let this happen -- but it is also unlikely to do away with the estate tax altogether.

Hence the good timing of Steinbrenner and three fellow billionaires who have died already this year. You know there is something very wrong with the tax code when you have estate planners saying things like "if you're super-wealthy, it's a good year to die," as BDO Seidman's Jack Nuckolls told the Associated Press. The AP put the Steinbrenner family's savings in the neighborhood of $500 million.

Congress set the estate tax to disappear in 2010 and be, pardon the phrase, brought back to life in 2011. No one expected this throw-Mama-from-the-train scenario to actually play out in 2010, but Congress has been unable to agree on a reasonable level for a new estate tax.

It's possible that an estate tax will be reinstated this year and applied retroactively, but there are a lot of law firms looking forward to billing for years of litigation over whether this is constitutional. Short answer: It is, but when has that ever stopped lawyers from arguing?

The estate tax situation is even more messed up than it appears. While the heirs of the super-rich reap a windfall and the Treasury loses badly needed revenue, some heirs of the not-so-super-rich are actually facing higher tax bills because, due to an accompanying change in the law, they have to pay capital gains on property that would otherwise have been able to pass tax-free.

The notion of repealing the so-called "death tax" was wrong at a time of supposed budget surplus and is particularly irresponsible now. Even beyond bringing in needed revenue, the estate tax serves an important function.

As Michael J. Graetz and Ian Shapiro write in "Death by a Thousand Cuts," about the movement to repeal the estate tax, "For almost a century, the estate tax affected only the richest 1 or 2 percent of citizens, encouraged charity, and placed no burden on the vast majority of Americans. This tax was grounded on a core American value: that all people should have an equal opportunity to pursue their economic dreams." The only thing wrong with this account is that it overstates the bite of the modern estate tax, which applied to only two of every 1,000 estates in 2009.

The Obama administration has proposed renewing the estate tax at its 2009 level: 45 percent, with the first $3.5 million of an individual estate, or $7 million per couple, transferred tax-free. The House passed such a measure last year. That is more than adequate to protect against the supposed threat posed by the estate tax to family farms and other small businesses. If anything, this is too generous: It would cost about $250 billion over the next decade, compared to current law.

Not generous enough, though, for Sens. Jon Kyl, R-Ariz., and Blanche Lincoln, D-Ark., who are pressing for a $10 million per couple exemption and 35 percent rate -- although they hide the true long-term cost of this proposal by having it gradually phased in.

The latest bad idea, proposed by Rep. Mike Thompson, D-Calif., is an unlimited exemption from the estate tax for farms. This is unnecessary because very few family farms are large enough to be affected by the estate tax -- the Urban Institute and Brookings Tax Policy Center estimates fewer than 110 next year if the tax were reinstated at its previous level.

This exemption is unwise because it would simply incentivize super-rich non-farmers to transfer their wealth to farmland and, as the Tax Policy Center concluded, "make the estate tax essentially voluntary for the very wealthy." It would actually hurt family farmers by driving up the price of agricultural land.

So maybe Steinbrenner's timely death can serve as a wake-up call uniting Yankees fans and Yankees haters alike. Resurrect the estate tax.

By Ruth Marcus  | July 15, 2010; 2:48 PM ET
Categories:  Marcus  | Tags:  Ruth Marcus  
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Comments

Actually, a retroactive estate tax is not constitutional. Carlton and other cases are irrelevent because they retroactively applied to an existing tax.

The estate tax does not exist in 2010. Congress would be retroactively creating a new tax. The legal counsel to the House Ways and Means Committee this year reached this conclusion.

Any discussion on the estate tax should be forward looking.

Posted by: ddowney1 | July 15, 2010 4:32 PM | Report abuse

Actually, a retroactive estate tax is not constitutional. Carlton and other cases are irrelevant because they retroactively applied to an existing tax code.

The estate tax does not exist in 2010. Congress would be retroactively creating a new tax. The legal counsel to the House Ways and Means Committee this year reached this conclusion.

Any discussion on the estate tax should be forward looking.

Posted by: ddowney1 | July 15, 2010 4:34 PM | Report abuse

Actually, a retroactive estate tax is not constitutional. Carlton and other cases are irrelevant because they retroactively applied to an existing tax code.

The estate tax does not exist in 2010. Congress would be retroactively creating a new tax. The legal counsel to the House Ways and Means Committee this year reached this conclusion.

Any discussion on the estate tax should be forward looking.

Posted by: ddowney1 | July 15, 2010 4:34 PM | Report abuse

Actually, a retroactive estate tax is not constitutional. Carlton and other cases are irrelevant because they retroactively applied to an existing tax code.

The estate tax does not exist in 2010. Congress would be retroactively creating a new tax. The legal counsel to the House Ways and Means Committee this year reached this conclusion.

Any discussion on the estate tax should be forward looking.

Posted by: ddowney1 | July 15, 2010 4:34 PM | Report abuse

How many here think a retroactive estate tax is not constitutional? One..two..three....
I've never understood why the government thinks they are entitled to confiscate someone's estate when they die. Why not tax the heirs on their new-found income, either ordinary income or even a gift tax? Taxing someone's estate is like taxing their income a second time (oops, missed some the first time).

Posted by: kitchendragon50 | July 15, 2010 4:48 PM | Report abuse

Why anyone pay taxes on their estate when they dies - that is douible taxation as they already paid taxes on their earnings. Only a pure socialist woudl see any redeeming value to death taxes. Rich or poor, taxes on an estate that has already paid taxes is immoral.

Posted by: Realist201 | July 15, 2010 4:57 PM | Report abuse

This probably makes alot of wealthy people nervous.
They examine their relatives and friends and potential trustees,and beneficiaries.This may be the year to stay close to home.
Stay away from ledges,mountains,waterfalls, flights,cruises,train rides hospitals.
Africa,Asia,Middle East,and South America should be off limits for someone might get a fairly good sized bug to kill you.

Posted by: TarheelChief | July 15, 2010 4:59 PM | Report abuse

Estate taxes should be an instrument used by government to protect the people from the formation of family dynasties that have the potential of having undue influence on or harmfully affecting future generations. For every Buffett or Gates there are ten times as many Kennedys or Hiltons.

Posted by: slim2 | July 15, 2010 5:01 PM | Report abuse

The government practically taxes you to death anyway, so why should they be rewarded with 45 or 55% more when they finally succeed.

Posted by: grobinette | July 15, 2010 5:01 PM | Report abuse

Retroactively applying the tax isn't fair. Plain and simple.
.
What I've never understood, and is misconstrued by both sides of the debate, is whether the 'Death Tax' is singly or doubly applied.
.
Is the tax only applied when the deceased's estate is transferred to the recipients as income (ala winning the lottery - a single infusion of income)?
.
Or is it taxed both at the value of estate and then the remaining amount taxed again as it is transferred to the recipients as income?
.
The former is reasonable, the latter unfair double taxation. But which is it in reality?

Posted by: rpixley220 | July 15, 2010 5:04 PM | Report abuse

Any good layer can find a legal way to tax the estate of Mr. Steinbrenner and it should be taxed. It will be taxed.

Posted by: AnotherContrarian | July 15, 2010 5:05 PM | Report abuse

He paid income tax on his earnings.

Let the family keep estate.

Why do Liberals think it's "fair" to confiscate assets that have already had income tax paid on them, and pour the money into a bottomless Federal government?

It's just whiney lazy slackers who complain about "fairness" - meaning, give me what somebody else worked for because I'm too lazy to earn it myself.

Bring on November!!

Posted by: drjcarlucci | July 15, 2010 5:11 PM | Report abuse

I'm not super-rich, never was and don't expect to be. I am curious, however, about the following quote, cited by Marcus without pause or explanation: "This tax was grounded on a core American value: that all people should have an equal opportunity to pursue their economic dreams." Can someone explain how the estate tax does that?

Posted by: willdd | July 15, 2010 5:13 PM | Report abuse

"And my advice for those who die... declare the pennies on your eyes."

Ms. Marcus, for the sake of your heirs, I hope you never win the lottery.

Posted by: MikeH0714 | July 15, 2010 5:14 PM | Report abuse

"...Any good layer..."

boom-boom long-time?

Jesus H. Tap Dancing Christ, what a maroon!

Posted by: sosueme1 | July 15, 2010 5:20 PM | Report abuse

The nerve of the liberals is simply astounding.

Ms Marcus never provides a moral or ethical prop for her demand that the government confiscate the largess left behind by successful people.

But then again, punishing success is what liberalism is all about.

What is just astounding is that the lady actually believes that she is right. She believes that she has the right to the wealth created by others. Based on what?

Here's a line from a cold play song:

And I'm just waitin till the firing starts.

How much robbery can the liberals commit before commonsense Americans start to defend their hard earned money.

Simply amazing.

I'm not condoning violence. But I am concerned that thoughtless ideologues like Ms Marcus will trigger a rebellion.

Posted by: skipsailing28 | July 15, 2010 5:22 PM | Report abuse

Posters claim the estate tax is taxing income for a second time. Well, then if I use $200. of my taxed income to pay a plumber, he shouldn't have to declare the $200. as taxable income since this money was "already taxed."
This is going to set the tax code on its ear!

Posted by: Davidd1 | July 15, 2010 5:24 PM | Report abuse

Estate taxes are essentially double jeopardy, and should be eliminated altogether. Regardless of how much someone makes, why should they be taxed twice? Just because someone dies, doesn't mean they don't care that the government is going to come along a take half of their fortune.

The estate tax will likely never affect me, but I do not think it's fair that just because someone is very successful and want to pass on that success to their heirs doesn't mean Uncle Sam can come along a scrape 45-55% off the top after that person spent a lifetime paying income taxes, property taxes, and sales taxes. I also feel that it's unfair that higher wage earners are taxed at higher rates.

A 15% flat tax of all income earned regardless of deductions or financial situation would make collection simple, filing a breeze, and accountants and tax lawyers obsolute. I guess that's why no one would dare propose such an idea.

Posted by: Russtinator | July 15, 2010 5:27 PM | Report abuse

George Steinbrenner's well-timed death -- though I suspect he may not have seen it that way -- points up the insanity of the current estate tax situation ............. you got it right, pay taxes whtn its earned and then pay again. Marcus your are a wuss.

Posted by: ZebZ | July 15, 2010 5:34 PM | Report abuse

The tax should not be on the estate; it should be on the money people receive from the estate, with a suitable exemption for each recipient. Divide the estate so that no one person receives more than the deductable amount, and there will be no tax on the estate's money.

There should be no issue about taxing the recipients of money from an estate. If we can tax the income of people who do work or make investments, we certainly should tax the income of people who are fortunate enough to be given a large sum of money.

Of course, since the people who make the rules are generally in the high estate range, they probably do not share this opinion.

Posted by: ad9inaz | July 15, 2010 5:34 PM | Report abuse

Do you morons have any idea how many small to medium sized businesses/farms have had to liquidate in order to satisfy the tax man? Jobs disappear because of this nonsense!

And why wasn't my other post published? The damn censor-bot around here needs to go away!

Posted by: sosueme1 | July 15, 2010 5:34 PM | Report abuse

'If anything, this is too generous: It would cost about $250 billion over the next decade, compared to current law.'

This is an example of how the tax and spend legislators in Washington think.

How can something cost one entity a sum when whatever money being discussed actually belongs to some other entity. Tax revenues are due under the terms of laws requiring them, but a reduction or elimination of a given tax is not a cost to the government but more akin to lost sales in a private business.

Posted by: BobThompson | July 15, 2010 5:37 PM | Report abuse

Some of us are getting a fund together to pay Ruth Marcus' estate taxes when SHE kicks..... glad to pay it....

Posted by: JPMcC | July 15, 2010 5:39 PM | Report abuse

Members of congress who couldn't agree on an estate tax should be removed. If bickering employees of a company cost it billions of dollars, so would they.
Hopefully Bill gates won't die this year.

Posted by: japeurotrash | July 15, 2010 5:41 PM | Report abuse

Oh, and Marcus thinks she's entitled to a cut from George's estate? Why? He already paid probably a billion lifetime. The IRS, NY State and City profited handsomely from all his endeavors across 80 years of the man's life and here's Liberal WhackNut wealth-Envy Marcus (and 150,000,000 OTHER liberal wealth-envy whacknuts) wanting to pick the bones of the man's estate. Disgraceful. It's going to be so GOOD to see Democrats restored to their rightful place in the dustbin of obscurity for another 25 years and the damage they've done reversed. It's reprehensible that these liberal, thieving jealous do-nothings feel entitled to pick the fruit of the labors of other for...what? Oh yeah, to hand out other's dough to their constituencies to stay in office. Creeps.

Posted by: JamesChristian | July 15, 2010 5:47 PM | Report abuse

OMG Double Taxation. Oh No the government is taking my money!!

Please.

Realist, Carlucci and everyone else who claims double taxation forgets that everyone is taxed multiple times on the same income throughout their lifetime: Income taxes, sales tax, property tax, etc.

In fact this isn't even double taxation. Are you being taxed when you die. No, you're dead. How the hell do you tax a dead guy. Your relatives are being taxed; and that is perfectly fine because the estate tax is the most American tax of all. It prevents people from getting rich off of effort that is not their own. In fact I would raise the limit to 75 percent if I had my way.

Meritocracy not Aristocracy.

Posted by: aabuakee | July 15, 2010 5:49 PM | Report abuse

Reading about how the super rich among us pay few, to no, taxes is just galling when I also read that someone making $76K a year has to pay $15K in federal taxes. That doesn't even include whatever state taxes, or local taxes, that individual may have to pay.
Of course, even IF the super rich had to pay a big tax bill that would NOT effect their life style at all. They would STILL be able to have anything and everything they want whenever they want it.
And, that's the thing that is so offensive about Republicans, they want the rich to pay no taxes, when paying taxes would not even hurt them in any way.

Posted by: cms1 | July 15, 2010 5:58 PM | Report abuse

One of the code words that knuckle draggers like to throw around is "elite," as in the evil, ZOG-Washington elite. This is one those issues that very neatly frames just which party is really on the side of the elite. (I'm assuming those top 1 out of every 2000 households are part of the elite, however one could possibly define it.)

Posted by: Cossackathon | July 15, 2010 6:01 PM | Report abuse

"It prevents people from getting rich off of effort that is not their own."

Except for government-run lotteries. Those are fine because the government get most of the money.

Posted by: kitchendragon50 | July 15, 2010 6:04 PM | Report abuse

From the WSJ:

\\The estate tax lapsed temporarily on Jan. 1 after the Senate failed to extend it last year. If lawmakers do nothing, the tax will resume in 2011 with a 55% rate on estates above about $1.2 million. Last year, estates of more than $3.5 million for an individual were subject to a 45% tax.

Mr. Sanders [socialist, Vermont] and his co-sponsors said, "It's time for multi-millionaires and billionaires to pay their fair share."

Under the proposal, as in 2009, the exemption would be $3.5 million for an individual, or as much as $7 million for a couple, with a tax rate of 45%. But estates with taxable assets between $10 million and $50 million would pay a 50% rate, and estates valued above $50 million would pay 55%. A further 10% surtax would apply to assets above $500 million.

The changes would be retroactive to Jan. 1 of this year.//

What is most offensive about the estate tax is that the federal government gets to name itself the prime beneficiary of any estate that qualifies. I find that disgusting and typical of the greedy liberal mindset.

Posted by: theduke89 | July 15, 2010 6:17 PM | Report abuse

"Why anyone pay taxes on their estate when they dies - that is douible taxation as they already paid taxes on their earnings. Only a pure socialist woudl see any redeeming value to death taxes. Rich or poor, taxes on an estate that has already paid taxes is immoral."

WRONG. Most wealth in estates is in real estate and stocks. Normally, you'd have to pay capital gains taxes on any gains in the value of these assets. However, when assets are passed to an heir, they are passed at face value (so there are no capital gains taxes). Thus, the only taxes on those assets are estate taxes (except for this year, when they are paying capital gains taxes instead). If you eliminate the estate tax, super wealthy people actually avoid paying taxes that everyone else has to normally pay. How is that fair?

Posted by: g99999 | July 15, 2010 6:18 PM | Report abuse

My main complaint on an Estate tax is that it is taxed at a different rate than income. It should just count as income on the heirs next tax return. Simple.

Although to be honest taxing gifts or any other sort of income is pretty backwards. We should be taxing consumption instead.

Get rid of the income tax and replace it with a VAT. Maybe exclude grocery and rent costs among other common living expenses to lessen the burden on the poor. It would incentify saving, investing and working.

Posted by: BradG | July 15, 2010 6:21 PM | Report abuse

Ruth and her craven political views. Characterizing one's death as "lucky", because she's not going to get her hands on some of that wealth through a double-tax. 55%! The Founding Fathers went to war over a lower tax than that.

Posted by: ajsja | July 15, 2010 6:22 PM | Report abuse

"The notion of repealing the so-called "death tax" was wrong at a time of supposed budget surplus and is particularly irresponsible now. Even beyond bringing in needed revenue, the estate tax serves an important function.

..."For almost a century, the estate tax affected only the richest 1 or 2 percent of citizens, encouraged charity, and placed no burden on the vast majority of Americans. This tax was grounded on a core American value: that all people should have an equal opportunity to pursue their economic dreams." "

Poppycock. JIM CROW only affected blacks, who are a minority, but that didn't make it any more right. If anything, it was even more wrong because it represented bullying of the minority by the majority. As for "equal opportunity to pursue their economic dreams", the estate tax helps no individuals, because the money goes to the government. It only hurts individuals. It should be up to the decedent whether or not to enrich their progeny, and there's a lot to be said for giving it to charity. But that should be the choice of him who earned it. If people REALLY thought big estates were bad, they'd confiscate them with a 100% tax -- but no one has the stones to do that, because we all want to leave our heirs in as good as position as we can and deem proper. The estate tax is a tax on death, and as such, it is morally bankrupt.

And in calling Steinbrenner's death "well-timed", you are now in the company of such sensitive souls as Rush Limbaugh, Ruth.

Posted by: gbooksdc | July 15, 2010 6:26 PM | Report abuse

Estate Taxes, Tax Cuts, The Rich and the USA deficit:

“What’s another $678 Billion?” GOP has no problem extending tax cuts for the rich
http://www.washingtonpost.com/wp-dyn/content/article/2010/07/13/AR2010071305391.html

“SENATE REPUBLICANS, committed as they are to preventing the debt from mounting further, can't approve an extension of unemployment benefits because it would cost $35 billion . But they are untroubled by the notion of digging the hole $678 billion deeper by extending President Bush's tax cuts for the wealthiest of Americans.”

The Washington Post: Choose your own deficit:
http://www.washingtonpost.com/wp-dyn/content/article/2010/06/26/AR2010062600222.html

“The Bush tax cuts are really expensive. The tax cuts expire this year. If lawmakers renew all of them, they'd add $6 trillion to the deficit from 2012 to 2022.”

http://voices.washingtonpost.com/ezra-klein/2010/07/research_desk_compares_whats_t.html#more

Estate Taxes and the USA deficit: The current Estate Tax giveaway to the Rich is costing the USA $300~700 Billion between 2009 and 2018. The one year unemployment extension is $35 Billion.

Oil Companies make Hundreds of Billions every year and pay very little in Taxes. Exxon paid "$0.00" in USA federal taxes in 2009. Now that's a sweet deal.

Those are all some Sweet Sweet Sweet Tax Breaks. Those Taxes Should Be Raised, Loopholes eliminated, and the Money used to Create USA Jobs and Industries that Manufacture product that can be sold.

It's good to be Rich and get multiple tax breaks and subsidies while soldiers do the fighting in the Middle East. It's good to be the Kings of Subsidies. It’s good to take the Profits while the Pollution is paid for by the Public.

Posted by: Airborne82 | July 15, 2010 6:27 PM | Report abuse

">>>the billionaire Yankees owner could end up owing no federal estate tax -- because there is no federal estate tax this year. "

NOTE TO RUTH AND KATRINA:

He is dead. There is no way he could owe federal estate taxes.

Posted by: etronsen | July 15, 2010 6:28 PM | Report abuse

The death tax is theft, socialist piracy, a greedy grab for what is not rightfully public property. A simple case of the improvident "have-nots" taking any bite they can out of the "haves". Further the death tax is a tool used by organized charities to tilt the scales in favor of giving the money to them! Keep your thieving friggin' hands to yourself! Or at least face the immorality of your attitudes and actions.

Posted by: alfisher1 | July 15, 2010 6:30 PM | Report abuse

Most income is already double taxed. We pay income tax and then all sorts of other little taxes (sales, telecoms, gasoline, gift, estate). If the idea of seizing money in different ways appalls people, then we should go either with a single national sales tax to cover all revenue requirements of the gov't (the most regressive system) or a sufficiently high progressive national income tax and no other taxes.

The reason there are different types of tax is not because they are "morally" justified, it's because they are intended to avoid getting too much money from one source and p*ssing people off and/or possibly focusing on certain types of consumption as especially worthy of taxation (e.g., cigarettes and alcohol). Most of this diversification in taxation is about psychology, not morality. It's not really any more "moral" to take 50% of someone's income directly from the paycheck vs. taking 25% from pay and 25% from other transactions.

Posted by: Matthew_DC | July 15, 2010 6:31 PM | Report abuse

'Elections should be held on April 16th- the day after we pay our income taxes. That is one of the few things that might discourage politicians from being big spenders.'

Thomas Sowell

Posted by: slatt321 | July 15, 2010 6:41 PM | Report abuse

Call me naive, but it seems reasonable to think that the heirs of Mr. Steinbrenner might just invest those extra millions more efficiently and more productively than would the federal government. Venture capital, municipal bonds. You know, the stuff that actually puts people to work producing stuff.

Posted by: RossOdom | July 15, 2010 6:42 PM | Report abuse

'I can make a firm pledge, under my plan, no family making less than $250,000 a year will see any form of tax increase. Not your income tax, not your payroll tax, not your capital gains taxes, not any of your taxes.'

Barack Obama

Posted by: slatt321 | July 15, 2010 6:43 PM | Report abuse

I can't believe that anyone has a problem paying these taxes. We're paying for stellar government services. Look at how well the federal government has handled the Gulf oil spill, your tax dollars hard at work. Many government employees completely unemployable in the private sector, spending half their working day completing the WaPo crossword puzzle. Stop complaining about taxes!

Posted by: randysbailin | July 15, 2010 6:47 PM | Report abuse

Odd, but telling. Steinbrenner dies and all most people talk about is estate/death taxes and money.
True enough, he was a well-loathed figure. SO, money really is what there is to talk about.
Did he really see death without taxes as too good a deal to pass by? If so, his timing was good....not great, but good. Five months early. Better to be sure.

Posted by: jmf3210 | July 15, 2010 7:19 PM | Report abuse

Take your salary, subtract all the federal and state taxes withheld and then calculate all the tax you pay on what's left over. Sales, property, utility, DMV, gas and energy keep going, not there yet....what's really left at the end of the calculation? C'mon, do the math.

Our Fed and State governments spend and spend regardless of the "take" each year and look where it's gotten us. We all need to pay a fair tax to a responsible government, but this folks, ain't it. And the tax receipts isn't "their" money. It's ours, entrusted to them to spend wisely.

Ruthie, it's not for the Federal government to say what I do with my money that I have earned and saved and already paid taxes on. That's for me to decide. And really, effyew for inviting yourself into the conversation. You think we should tax estates just because this miserable corrupt goverment says they need the revenue? It's not like they'll spend it responsibly! Goodness, even you should realise that!
Tax, tax and tax. And when you're done with that, tax more. Didn't the EU already try that without a ton of success?

Really am convinced that liberals never met a source of revenue they didn't think they were entitled to. And they really don't seem to much care about your rights and values as they seem to know what's best for everyone, even after you're dead.

Mr. Steinbrenner, RIP. You've earned that too.

Posted by: WacoDave | July 15, 2010 7:29 PM | Report abuse

It's articles like this that make me wonder why I ever go to the WP website. ughh.

A retroactive estate tax is not constitutional. The federal government is prohibited from passing ex post facto laws by clause 3 of Article I, section 9 of the U.S. Constitution and the states are prohibited from the same by clause 1 of Article I, section 10.

And second, there shouldn't even be an estate tax on any level. We are taxed enough. I am sure Steinbrenner paid millions and millions of taxes to Fed, State and NYC governments. Plus an estate is usually broken up to many heirs and taking 45/55% is unconscionable! The estate tax is rooted in class envy. Trying to "stick it" to the heirs.

BTW, I am middle class Washingtonian who doesn't have a chance of benefiting in a lack of an estate tax anytime soon.

Posted by: isguy | July 15, 2010 7:32 PM | Report abuse

That a man can die without owing substantial amounts to the government galls liberals like Marcus. Just think how many stimulus plans Obama could finagle with Steinbrenner money. None of which plans work anyway- Democrats simply like to collect and spend other peopls's money. It's in their DNA.

Posted by: mhr614 | July 15, 2010 7:40 PM | Report abuse

The dead person isn't being taxed "twice." He be daid... No one is taxing a corpse. However, the $ passed along to their kin is somewhat "unearned income" and they are paying the taxes since they benefit from the windfall.

Posted by: itsagreatday1 | July 15, 2010 7:53 PM | Report abuse

That socialist liberal commie pinko, Thomas Jefferson, believed that estate taxes should be confiscatory to allow each generation to make its own way in the world. He had lots of ideas that current conservative philosophy would deem leftist. Of course, the modern conservative seems to know little about history and just assumes the estate tax was something thought up by Franklin Roosevelt or Jimmy Carter.

Posted by: BuddyK | July 15, 2010 7:54 PM | Report abuse

Ever think that we should just cut taxes and spending. We wouldn't have to read this dribble if government wasn't such a far reaching behemoth.

You know what all those evil villains do when their plots fail? They run for Congress.

Posted by: axxionx12 | July 15, 2010 7:55 PM | Report abuse

I've always wondered how the politicians felt they are entitled to the earned wealth of someone. Most have never built a business or provided any valued added by their own sweat to anyone else. They continually try to find ways to take away from the successful, and usually hard working, individual to dole it out to their constituents for "the common good".

Most of the folks in favor of this haven't risked anything in their lives and will likely never amass an estate more extensive than a used Toyota Prius and some eco-green canvas grocery bags. You and your mass of looters make me ill...... Go produce something someone wants and contribute instead of whining about your needs.

Posted by: Spitfires | July 15, 2010 8:04 PM | Report abuse

There is no economic justification of the Estate Tax. The only justification is as follows: I don't want some undeserving kids to inherit a lifetime of wealth for being the kid of a rich schmuck.
That is appealing to the socialist inside of many people. However, it is an economic waste. The money will benefit the economy much more in the hands of an investor looking to maximize their capital return than from a congressman looking to spread the pork to favored constituents.

Grow up and get over your childish need for everyone else to be at least as poor as you.

Posted by: natecar | July 15, 2010 8:32 PM | Report abuse

It is interesting to note that Congress usually tinkers with the tax code when it wants to covertly reward somebody. There is NO excuse for the wealthy to escape taxation. The GOP claims the estate tax cruelly taxes death, thereby collapsing family-run businesses. It hasn't worked that way and shouldn't. But there is no way some lucky AND wealthy decedent's heirs should lie in mansions under silk sheets (absent a Federal Estate Tax) just because the old man was an accomplished money gatherer. Let f(x) be a monotone increasing linear function. Let x be the value of the estate. Then f(x-b) is what the estate pays the Federal Government in tax. When x-b is negative (b is the amount excluded from taxation), the tax is zero. Set b to $10 million, adjusted for inflation. Should the Federal Government fritter the money away on boneheaded ideas, elect a better class of people to high office.

Posted by: BlueTwo1 | July 15, 2010 8:34 PM | Report abuse

If you want to avoid paying 45% estate taxes on what you have spent a lifetime building and want to see that your children get the money and that your grand children get the money, you go out and hire a competent tax attorney. This is what I did and they will get everything. This is my comment.

Posted by: jeffreed | July 15, 2010 8:39 PM | Report abuse

I understand the arguments for the estate tax, but I still have difficulty supporting it. People who have worked for their money that has already been taxed once should be able to give it to whoever they want without government intereference.

Posted by: CommonGuy | July 15, 2010 8:59 PM | Report abuse

I understand the arguments for the estate tax, but I still have difficulty supporting it. People who have worked for their money that has already been taxed once should be able to give it to whoever they want without government intereference.

Posted by: CommonGuy | July 15, 2010 8:59 PM | Report abuse

Consider farmers...

WP's one-sided reporting only takes into account a single situation. If you want to reform estate tax laws, do it right! The reason the estate taxes were suspended were that family farms were being lost because of these taxes. Just a few miles from Washington, DC, you have farmers who have been raising crops for generations. Only five years ago, there were orchards and vineyards in Fairfax County.

As the DC area sprawls further out (which you liberals so loudly object to), the value of these farms increase because they become the next place to locate the next batch of McMansions. Over the span of a generation, the relatively worthless cornfield on which a family has raised crops for generations becomes extremely valuable. In the eyes of an old liberal like Marcus, she only sees the passing of a valuable asset. But many farmer's children would like to keep on farming if they only afford the land. With an estate tax reinstated, a child would be required to sell off half of the family's land if the parent died.

A you "smart-growth" liberals would hate this because that half of the land is sold off to become another batch of outer-DC McMansions. What do you liberals want?

If you're going to reform estate tax and close this farm "loophole for the rich", don't close it at the expense of real family famers!

Posted by: reston75 | July 15, 2010 9:09 PM | Report abuse


Ms. Marcus:
There is no way I can agree to an estate tax on property that has already been taxed six ways from Sunday.
The estate tax is simply a socialist mechanism to prevent rich people from getting richer.
Call it what you will...it is NOT a core American value...what color is the sky in your world where "This tax was grounded on a core American value: that all people should have an equal opportunity to pursue their economic dreams." can be interpreted as meaning taking away the hard-earned estates of even the top one or two percent of Americans (I guess the top one or two percent aren't part of the 'all people' group) to fund the misbegotten lifestyles of the lower 50% of non-taxpaying Americans?!

That is not a core value...that is simply 1984 NewSpeak coming out in a socialist lawmaking body that thinks anyone making more than $100k per year should be taxed to death.

We've already hit or are approaching the tipping point where more than 50% of the voting population does not pay taxes yet gets to vote on increasing the tax bite of those who do. This cannot stand because a democracy can only exist until the voters vote themselves largesse from the public treasury!

Posted by: joy5 | July 15, 2010 9:12 PM | Report abuse

maybe we should have no tax for the rest of us and maybe the economy will turn around when business owners will have a reason to be successful and perpetuate there business to the next generation - what a novel idea . . .

Posted by: corp21 | July 15, 2010 9:23 PM | Report abuse

Davidd1 sez-

Posters claim the estate tax is taxing income for a second time. Well, then if I use $200. of my taxed income to pay a plumber, he shouldn't have to declare the $200. as taxable income since this money was "already taxed."
This is going to set the tax code on its ear!
-----------------------
First, who as the money is the question. When the plumber recieves the money, it is for services rendered. That's why it is called a "Personal Income Tax."

Although my knowledge of the tax code is limited, the question is:

After the estate tax is paid, are the individual heirs that do receive the money or property, are they subject to an income tax liability.

If so then-

55% for the estate tax
36% for the income tax (2011)

Then the US Government collects 91%.

Yeah, sounds like a major rip-off by the Democrats to me.

Posted by: Computer_Forensics_Expert_Computer_Expert_Witness | July 15, 2010 9:41 PM | Report abuse

Do they have a,"Pre born tax," where you are taxed while in the Mother's Womb? If not, how can you tax me after I've kicked it?

If you die and you die, while living, "Under the poverty level," will the government then, "Reward the surviving family," with a, "Death Bonus?"

Good grief, we'd have all kinds of matricide and patricide going on..........

You know where you can stick your death tax....

Posted by: mikewoolsey | July 15, 2010 9:44 PM | Report abuse

Drop dead Marcus.

Posted by: RobertCurleyJacobs | July 15, 2010 9:48 PM | Report abuse

Can someone please explain intelligently why estate tax IS legal?

Posted by: acasey2 | July 15, 2010 10:16 PM | Report abuse

OMG! You the money someone EARNED through hard work isn't going to be taxed TWICE!?!?!

Please explain why I should be outraged about this.

Posted by: arlingtonresident | July 15, 2010 10:23 PM | Report abuse

The main argument against the estate tax is inherently dishonest and demonstrably false.

Opponents of the estate tax claim double-taxation, that the money is taxed when it is earned and then again at death. They use this as the main argument against the estate tax. But, in the case of high net worth individuals, this is simply untrue.

Let's say that tomorrow, Larry Ellison (founder of Oracle) and Bill Gates (of Microsoft) both drop dead. Both of them have fortunes amassed in the common shares of the companies they founded. Both of them hold literally millions of those shares, all with a cost basis very near zero. They never paid any capital gains tax on their holdings because they never traded the shares.

In this scenario -- which most tax attorneys would argue is the norm for high net worth individuals -- when, exactly, was the first taxation on these assets of Mssrs Ellison and Gates? It never happened! So it's a lie to say that that the estate tax is double taxation. While that may be true for working families, it is definitely not true for America's billionaire families.

Same holds true for George Steinbrenner. He purchased the Yankees for about 5% of the current asset value. He never paid tax on the capital gains. His heirs shouldn't get a pass now.

Posted by: SkyBeaver | July 15, 2010 10:27 PM | Report abuse

Dear Ruth Marcus ... you are apoplectic because the government isn't taking it all in taxes?

If you really feel that way, send a big check to the Bureau of the Public Debt.

Posted by: oracle2world | July 15, 2010 10:40 PM | Report abuse

"Can someone please explain intelligently why estate tax IS legal?"

Bc Congress passes the law and the President signs it. Fairly straightforward. Now, that doesn't mean there aren't very valid arguments against it. I believe it's a bunch of bs based on the fact that that money has already been taxed and it's just another way for politicians to get their hands on more money. I seem to remember we revolted against England for unfair taxation and yet we have slowly but surely devolved into a country with a government that survives on overtaxing it's populace. The founding fathers would be appalled at such a tax to go along with a lot of other things in the current state of the union.

"A government big enough to give you everything you want is strong enough to take everything you have."- Thomas Jefferson.

Posted by: rphilli721 | July 15, 2010 10:47 PM | Report abuse

I'm not super-rich, never was and don't expect to be. I am curious, however, about the following quote, cited by Marcus without pause or explanation: "This tax was grounded on a core American value: that all people should have an equal opportunity to pursue their economic dreams." Can someone explain how the estate tax does that?

Posted by: willdd
---------------------------------
Hey, you got me there. The equal opportunity stuff is pretty well established ... but tying it to taxes? I think even the IRS would blush at making that connection.

Posted by: oracle2world | July 15, 2010 10:48 PM | Report abuse

@Skybeaver,

Don't be a nitwit. When and if those assets are liquefied by the current owners or heirs, then they will be taxed at the appropriate capital gains rate, which combined with an estate tax could mean the government rakes in well over half a person's amassed fortune. Completely un-American and grotesque IMO.

In the case of GS, he has employed thousands of people and been very generous with his money throughout his life. The fact that he was a GREAT businessman who made a very wise investment should be no concern of yours except to try and learn how he did it.

Posted by: rphilli721 | July 15, 2010 11:00 PM | Report abuse

Not Constitutional? OMG these hillbilly teabaggers are nuts. Congress has the power to what? Oh yeah, to TAX. This is a TAX. Totally constitutional. Amazing that a majority of these people don't have two cents to rub together, but yet so vociferously defend the ability of really rich people to not have to pay a tax on their estates when they die. Well excuse me for not having much sympathy for corpses of billionaires, but one of the reasons we have such huge budget problems is because of these ridiculous Bush tax cuts.

Reinstate the Estate tax. The corpses of the rich shouldn't be entitled to special privileges any more than the rest of us still left alive to fund two stupid wars at $1 million per soldier....

Posted by: hyperlexis | July 15, 2010 11:24 PM | Report abuse

SkyBeaver: If the assets were never sold off, then of course capital gains were never paid. So what was your point again?

Posted by: njoebott | July 15, 2010 11:42 PM | Report abuse

Why do you feel his heirs should have to anything at all? His income was taxed as it was acquired. Once is surely enough. The concept is absurd and should stay dead forever.

Posted by: sagedutch | July 15, 2010 11:57 PM | Report abuse

When we tax less than we spend, which covers most of the last 75 years, we both stimulate the economy and accumulate debt. Estates have gotten larger, much larger, due to the stimulus. And debt has gotten larger, much larger. Had we been balancing the budget all these years, those estates would not be nearly as big.

If you think taxing estates, to make payments on the accumulated debt, is unfair, I'm willing to listen to reason. Just tell me what tax you'd propose that would be fairer.

Posted by: jb1949 | July 16, 2010 12:05 AM | Report abuse

Wow, didn't realize I accidentally walked into a Palin reading room. First of all, to all of those worried about double taxation, the estate tax applies to the estate only. What you receive as inheritance is not taxable (except by some states) because it is considered a gift and gifts are not taxable by the IRS.
Secondly, the estate tax is not some invention cooked by Marx and Nancy Pelosi. Every society since ancient Rome has had one for a very simple reason, to prevent the accumulation of wealth that could distort society. Without one today, it would be conceivable that Jay Rockefeller, instead of being a irritating senator from West Virginia, would acutally control ExxonMobil .... and half of Texaco...and a large part of BP.
Stop this pathetic whining about the government taking your hard-earned money like a bunch of kindergartners just realizing life's not fair. It's what the government does. It always has and always will.

Posted by: LazloHolyfeld | July 16, 2010 12:27 AM | Report abuse

I have to laugh when a big-government advocate describes taking almost half a family's money as "generous" on the part of the government.
By that logic, if a thief broke into my house, but took only half my valuables, he would be considered a generous person.

Confiscating a person's property is never "generous."

Posted by: tmarkstamm | July 16, 2010 8:30 AM | Report abuse

Let's say that tomorrow, Larry Ellison (founder of Oracle) and Bill Gates (of Microsoft) both drop dead. Both of them have fortunes amassed in the common shares of the companies they founded. Both of them hold literally millions of those shares, all with a cost basis very near zero. They never paid any capital gains tax on their holdings because they never traded the shares.

In this scenario -- which most tax attorneys would argue is the norm for high net worth individuals -- when, exactly, was the first taxation on these assets of Mssrs Ellison and Gates? It never happened! So it's a lie to say that that the estate tax is double taxation. While that may be true for working families, it is definitely not true for America's billionaire families.

Same holds true for George Steinbrenner. He purchased the Yankees for about 5% of the current asset value. He never paid tax on the capital gains. His heirs shouldn't get a pass now.

Posted by: SkyBeaver | July 15, 2010 10:27 PM | Report abuse

We won't need to hold a telethon for Messrs. Gates and Ellison, but the corporate income tax on Microsoft and Oracle stock has reduced the value of their shares to the relative extent of the tax. Any dividends or sale of stock results in additional dividend or cap. gain tax. Once they kick the bucket, their income will have been taxed 3 times: corporate income tax, dividend/cap. gain, estate tax.

Posted by: randysbailin | July 16, 2010 8:32 AM | Report abuse

I've discovered 2 loop holes to the estate tax: (1) if you don't die, you needn't worry about the tax (2) if you die w/ nothing, once again, you're off the hook. Failing those 2, you're screwed....

Posted by: randysbailin | July 16, 2010 8:36 AM | Report abuse

The largest percentage of most estates has not been taxed previously. It usually is largely capital gains on investments made in businesses years ago. The now expired system allowed the current value to be used in valuing the estate, circumventing capital gains taxes. The tax on virtually all estates will increase due to the loss of this step up in value, as capital gains will be payable on most of the value of the estate. And not just for the uber wealthy.

Posted by: kmar20009 | July 16, 2010 9:33 AM | Report abuse

The estate tax situation is even more messed up than it appears. While the heirs of the super-rich reap a windfall and the Treasury loses badly needed revenue, some heirs of the not-so-super-rich are actually facing higher tax bills because, due to an accompanying change in the law, they have to pay capital gains on property that would otherwise have been able to pass tax-free.

The notion of repealing the so-called "death tax" was wrong at a time of supposed budget surplus and is particularly irresponsible now. Even beyond bringing in needed revenue, the estate tax serves an important function.

As Michael J. Graetz and Ian Shapiro write in "Death by a Thousand Cuts," about the movement to repeal the estate tax, "For almost a century, the estate tax affected only the richest 1 or 2 percent of citizens, encouraged charity, and placed no burden on the vast majority of Americans. This tax was grounded on a core American value: that all people should have an equal opportunity to pursue their economic dreams." The only thing wrong with this account is that it overstates the bite of the modern estate tax, which applied to only two of every 1,000 estates in 2009.

-------------------------------------------
1. No, actually the estate tax situation is more complicated. Although there is no estate tax, property passing by will now has no step-up basis, that is, capital gains will now have to paid on the difference between the amount the decedent paid for the property and its current value. This is not limited by any minimum estate value, as it is now a plain vanilla tax on the capital gains transfer. Contrary to Ms. Marcus, it applies both to the superrich, the rich, and regular people.
2. This tax was grounded on a core American value: that all people should have an equal opportunity to pursue their economic dreams." No, that is the core value of redistributionists. The core values of most Americans that I know is that property should only be taxed once, and that what they earn during this life should help give their kids a better life.
3. What is the benefit of the estate tax as compared to the costs of enforcment of the more and more complicated estate tax rules and the costs to beneficiaries (not those simply above the putative tax minimum, but those who want to reduce their estate below the minimum for estate tax liability)? Why should the federal government be the maximum beneficiary in any estate situation? If one is going for resdistibution, why not be honest about it. Pass a law that says that if you earn more than 3.5 million--or the current estate tax limit--we will take 55% (not counting your other taxes) because we want other Americans to have the opporutnity (sic) results that you obtained. Equality of opportunity is not equality of result.

Posted by: paladin7c | July 16, 2010 9:42 AM | Report abuse

SkyBeaver: If the assets were never sold off, then of course capital gains were never paid. So what was your point again?

Posted by: njoebott | July 15, 2010 11:42 PM | Report abuse
----------------------------------------
That the capital gains will be paid from property's new owner without stepup when the assets are sold? You know, just like it is if you aren't dead??

Posted by: paladin7c | July 16, 2010 9:45 AM | Report abuse

Why anyone pay taxes on their estate when they dies - that is douible taxation as they already paid taxes on their earnings. Only a pure socialist woudl see any redeeming value to death taxes. Rich or poor, taxes on an estate that has already paid taxes is immoral."

WRONG. Most wealth in estates is in real estate and stocks. Normally, you'd have to pay capital gains taxes on any gains in the value of these assets. However, when assets are passed to an heir, they are passed at face value (so there are no capital gains taxes). Thus, the only taxes on those assets are estate taxes (except for this year, when they are paying capital gains taxes instead). If you eliminate the estate tax, super wealthy people actually avoid paying taxes that everyone else has to normally pay. How is that fair?

------------------------------------------
Tax transfer #1--Income taxed on earnings
Tax transfer #2--Tax on dividends or interest received
Tax transfer #3A--In the absence of estate tax--Gain taxed on transfer from original owner to new owner at capital gains rate. Applies to everybody, not just "rich" people.
Tax transfer #4A--In the presence of estate taxes--Capital Gain not taxed to new owner, but current value of property is put into the estate. They are taxed at current value because the government thought it was too complicated for people to try to calculate bases that may be decades old. Sorry, in 2010 you still have to pay capital gains on the property.

So, which tax transfer do the rich people not do, again?

Posted by: paladin7c | July 16, 2010 10:01 AM | Report abuse

Boo hoo! Poor George Steinbrenner isn't in his grave yet, and ghouls like Ruth Marcus and Senator Bernie Sanders are already whining about how "unfair" it is that our greedy, spendthrift government can't get its grasping mitts on any of Mr. Steinbrenner's estate.

The insanity here is all with Ms. Marcus.

Posted by: TArbiter | July 16, 2010 10:09 AM | Report abuse

"It's possible that an estate tax will be reinstated this year and applied retroactively, but there are a lot of law firms looking forward to billing for years of litigation over whether this is constitutional. Short answer: It is, but when has that ever stopped lawyers from arguing?"

=====================================

Ruth,

Ever heard of ex post facto laws? Congress is forbidden from passing them.

This nugget of info can be found in a document called the US Constitution (Art I, sec. 9).

Liberals like you should read it sometime.

Posted by: Hk45 | July 16, 2010 10:31 AM | Report abuse

Oh no not again and again. How many times will they tax the money that I have made?

How many times does that used car get taxed when it is sold and resold?

The Beatles did a very good song on this. Play it kids in case you forgot the words.

Posted by: Bubba20 | July 16, 2010 11:01 AM | Report abuse

Oh no not again and again. How many times will they tax the money that I have made?

How many times does that used car get taxed when it is sold and resold?

The Beatles did a very good song on this. Play it kids in case you forgot the words.

Posted by: Bubba20 | July 16, 2010 11:01 AM | Report abuse

Although Bernard Sanders has written a letter on the retroactive billionaire tax grab, currently the only estate tax bill being proposed on the Senate floor is the Kyle Lincoln proposal, which raises the marital deduction to $5MM over time, lowers the rate to 35% and gives people the option to comply with existing law this year- no estate tax but a capital gains tax- or the new law.

Sanders and his liberal cohorts have said in the past that they would support the $1MM exemption next year and the 45% rate. It makes me suspect this talk of a retroactive billionaire tax is just a stalling measure on the Democrats part so that the tax will skyrocket next year. Can you imagine the lawsuits on a retroactive billionaire tax increase? This is Robin Hood politicizing and not a good faith solution.

Kyl and Lincoln would like to attach this proposal to the Small Business Bill currently being debated. Reid has tried to "fill the tree", or not allow any more Republican amendments to the small business bill, such as the Kyl Lincoln bi-partisan estate tax proposal. However, the Democrats currently do not have the votes to pass the Small Business Bill. Olympia Snow is the 60th vote and she will not vote yes unless Reid allows the estate tax amendment.

If the Small Business Bill does not pass before the August recess, it will be because the majority leader Reid did not allow Kyl's estate tax amendment. That leaves the September session to get this done before the elections. What chance will the Democrats debate this prior to the elections, faced with losing control of the House and maybe the Senate? Their last chance this year for a retroactive estate tax would be a lame duck session after the elections, but that would be almost a year after the tax lapsed. Sound constitutional to you?

The Democrats accuse the Republicans of stalling. But I actually think it is the other way around, particularly for the most liberal democrats.

Posted by: ddowney1 | July 16, 2010 11:13 AM | Report abuse

I'll believe Republicans think that we are experiencing a fiscal crisis, when they are willing to slaughter a few of their own sacred cows to adress it (such as never raise any sort of tax, ever). Their response to the estate tax is a perfect example of just how unserious their huffing and puffing about deficits really is.

Posted by: ablum1 | July 16, 2010 11:27 AM | Report abuse

in response to this:
===========
"Can someone please explain intelligently why estate tax IS legal?"

Bc Congress passes the law and the President signs it. Fairly straightforward.
=========================

This is why I didn't ask about the legality. Instead I questioned the moral and ethical underpinnings of the tax itself.

thus far none of the liberal intelligensia here or elsewhere were able to provide an answer. My conclusion is that there is no moral or ethical support for this tax, they just think they should get the money. Just like they think they should get everyone else's money.

Posted by: skipsailing28 | July 16, 2010 11:41 AM | Report abuse

This is just the beginning of more taxation.
The VAT has already hit and it will hit those of you who think this death tax is just fine.
I am so tired of being taxed, but not tired enough to cheat.
Yes, my fellow Americans, the American story.
I was a mere child that very hot day in July. Arriving home,"in-time-for-dinner," to find my dad a young man had dropped dead from a heart attack. He had a very stressful job, protecting Americans from those Commie Bas___'s. He was the sole means of support for a wife and three little children. I mean, back in the "good old days," a mother stayed home and raised her children. Besides, what was a woman with a Masters in English going to do besides teach school for a few grand.
So, off to work I went. I was making money every way I could find: picking strawberries,cutting and spiking tobacco, building small sail boats, mowing lawns,( in that I had hired employess). So much; a soda-jerk, a cook, a newspaper boy, a delivery boy, janitor,(for the private school I attented in liew of the tuition). I will also admit to selling cherry bombs, at a enormous profit,just kidding( try and arrest me now).
I was taxed on every dollar I made, and I paid it. I also paid into this thing called FICA. What was this I needed to know because it was a large piece of my income. Today, my offer still stands, I will accept fifty cents on every dollar I paid in.
Right, I worked, saved, helped, and put myself through school.
My money was spent not the government's money.
When I finally kick-the bucket, and I am in no hurry for that as I have more to do and see, more people to love and care for, a loving wife and a dog who needs me as much as I need her. No hurry at all.
The b___h is that when I finally do they want to tax the very same money again.
We all know that there are several ways to avoid this. Many are legal. However, to tax and retax the same dollar is unconstitutional, yes my fellow Americans we still have one, a Constitution that is.
My great grand son came by the other day. He had been shopping for a car; a used car. I had explained to him that it is best to pay cash for a car, unless it will be a classic. He shopped and shopped, bargained and rebargained and found a nice, "short," "ride," for which he paid cash. As we sat on the front porch, he could not really understand all of the other costs beyond the price of the automobile. There was inspection, plates, (over one hundred dollars), then tax to be paid to the state for the car. I was told that he was the third or forth owner of this fine looking car. That baby purred. The car that had been taxed four times.

Posted by: Bubba20 | July 16, 2010 11:43 AM | Report abuse

The lack of a tax does not "cost" anything. Just as government spending is not "investment".

As for the estate tax generally, it's an abomination. Its limited scope (1-2% of the population according to Marcus) only highlights its nefariousness. It is rooted in envy (by the populace) and greed (by the legislature).

We have reached the tipping point. Half of the nation pays no federal income tax, and curiously, half believe their obligation is "about right".

I am not rich, and to make things worse, I don't feel very free.

Posted by: NNevada | July 16, 2010 11:46 AM | Report abuse

Slim you post:

"Estate taxes should be an instrument used by government to protect the people from the formation of family dynasties that have the potential of having undue influence on or harmfully affecting future generations. For every Buffett or Gates there are ten times as many Kennedys or Hiltons.

Posted by: slim2 | July 15, 2010 5:01 PM | Report abuse"

Unlike Warren, I believe in "dynastic wealth." My family should have my money just as Jefferson's father saw to it that he had his.

Posted by: Bubba20 | July 16, 2010 11:47 AM | Report abuse

I have no idea how some of these people figure various Hilton, Walton, and Steinbrenner heirs should get millions of dollars tax-free when Real Americans pay FICA starting with dollar number one.

The same anti-American whiners also hate the idea of a richie paying the same tax on its investment income as an American pays on his or her work-derived income.

In other words, the Republicans and their tea-buddies think work is stupid and that anyone who does it should be fleeced.

We've got your number, tea-people. We know tea is Russia's drink of choice, while we Americans drink coffee -- in part because we need strong stimulants to work hard enough to support not only ourselves and our families, but all of you social parasites, too.

Why don't you all go home to Russia now, comrades? We're tired of you here in America.

Posted by: roblimo | July 16, 2010 12:00 PM | Report abuse

I will never have this kind of money so I don't have to ever worry about what the estate tax limit is, but somebody has to explain to me why it's fair. Just because you can tax somebody and they can afford it, doesn't make it right. This seems to be the genesis of all higher tax arguments. Just keeping taxing the people who can afford it, and then tax'em some more.

The real taxes that need to be instituted are "sin taxes" where real damage is caused as a result of people's negative behavior. We pay the end freight with these folks due to increased medical bills, cessation programs, and rehab. I am all for people's freewill to destroy themselves and the ultimate cost is earlier death. But, maybe, if we front loaded some of the cost on these folks, we wouldn't have to overly tax people who's only problem is that they were too successful. Yet, the "sin tax" in real meaningful ways will never occur because (shocker) the people it would greatest effect is the people with the lowest income levels.

The answer isn't always "let's find more tax sources"...how about we limit our outlays?

- Cut Defense
- Raise the Retirement Age to 75
- Limit Unemployment Insurance
- In short, cut the size of Government, overall.

This is what true conservatism is all about. But for some reason, the crazies have taken over and turned into a religious, moral conservatism that I want nothing to do with and I don't stand for.

Posted by: d-35 | July 16, 2010 9:57 PM | Report abuse

Interesting how few people have mentioned the subsidies that stadiums have received, financed via taxes on ordinary working folk whose incomes are far lower than Steinbrenner's.

Is it churlish to ask for this to be returned to we-the-people once per generation?

Much of what is in most estates is unrealized "capital" gains. Well, capital doesn't appreciate. What rises in value is what is scarce or finite in supply: urban land and natural resources. Neither of these are created by individuals or corporations -- but the "wealth" of many individuals and corporations consists of their privilege of privatizing the value of these resources.


We'd be better off if we collected the rental value month in and month out, instead of once per generation. But not collecting it at all is a miserable idea.

Posted by: lvtfan | July 21, 2010 1:49 PM | Report abuse

My father in law is very ill and will likely die within the next month. He has savings bonds. When he dies, they'll be cashed in and his final income tax return will include a 28% tax on the interest from those bonds. The stocks George Steinbrenner held will be transferred to his heirs at the value on the day he died. NO ONE WILL EVER PAY ONE CENT IN TAX ON GAIN IN THE STOCK PRICES FROM THE DAY HE BOUGHT THEM UNTIL THE DAY HE DIED.Not income tax, not estate tax, nada, nil, nothing. And that's an example of why this Liberal believes it's unfair to not tax the wealthy at the same rate as the not-so-wealthy.

Posted by: perl47 | July 21, 2010 6:32 PM | Report abuse

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