March 7, 2009

"I already paid the tax. Why do I have to pay it again just 'cause I died?"



Lots more Whoopi-and-taxes links and discussion here.

110 comments:

AJ Lynch said...

A tipping point?

Recently Whoopi was also complaining about state, city, phone taxes etc which get piled on top of Obama's increase in federal income tax rate.

She was OK with slight increase in FIT but said "I make a very good living but enough is enough" re other taxes and fees.

Darcy said...

Sorry, babe. You don't get to complain about taxes after voting in the guy who loves to tax successful Americans and redistribute it for you. He told you that very clearly and repeatedly.

Deal with it.

Jim47 said...

Whoopi clearly isn't thinking about the poor estate planning professionals who would be adversely affected by such a change.

Chris said...

The "death tax" makes perfect sense. It promotes living people to consume rather than save. It probably harms deadbeat rich kids more than anyone else. I'm not for the death tax because I'm pretty much not for any tax. As taxes go, as a matter of public policy, the death tax is less annoying than pretty much any other tax I can think of.

Darcy said...

It is a fundamental issue of fairness, Chris. Hypocrite Whoopi is right. The taxes have been paid, over and over. I just don't have this big grudge against "rich kids" inheriting what their parents worked hard for and want to pass on to them. It's their money. Well...it should be, anyway.

Curtiss said...

Heh. All this surprise expressed first by so-called moderates, and now by the left.

I'm not sure why anyone would think that Obama really had no plan to do just what he promised to do during the campaign.

Perhaps when Obama supporters looked into his eyes they saw their own values and dreams, whatever they were. That was his great talent.

For his supporters, instead of being a window to the soul, Obama's eyes were a mirror to fools.

Is that too harsh?

Not for Whoopi, I think. And certainly not for Joy.

Meade said...

I would be happy to pay 100% of my income to taxes
as long as I get to tell government exactly how to spend it.

Chris said...

@Darcy,

I don't disagree. I'm just saying that as taxes go, the death tax doesn't bother me as much as a lot of other taxes. There is no question it isn't fair though. I'll grant you that.

sohereiam said...

And my gosh, so few people end up owing an estate tax, especially these days. Joy is correct; this is a rich man's burden, though easily shouldered -- I'll show you how! The outstanding problem is that we still haven't figured out a good way to protect small family farms, but beyond that there just aren't the great injustices Whoopi seems so concerned about. You can give yearly non-taxable gifts to your children (currently 13K), you can pay for their college, in many places you can co-own property that will then not be inherited and, as Chris says, you can simply spend the damn money before you die, and leave great sums of it to charity when you do.

Not a crisis.

AlphaLiberal said...

You're not paying the estate tax, Whoopi. The recipients are.

SteveR said...

In the trial to convict Joy Behar of being a complete idiot who responds instinctively without being able to utter an intelligent comeback, I present people exhibit Avogadro's Number.

Windbag said...

Obama has brought us together as a nation; I'm siding with Whoopi for the first time in my life.

rcocean said...

Typical Liberal. She loves the Government spending money, but doesn't want to pay taxes. Someone else should do that - she's special.

The "death tax" on dead rich people is the fairest tax there is. It doesn't tax producers it just means parasitic family members get less. I couldn't care less that Whoopi's daughter inherits $40 million instead of $60 million or that Bill Gates kid will have to by with just $2 or $3 billion.

No doubt some family business/farms are hurt by the tax - but that can be addressed.

Dust Bunny Queen said...

The outstanding problem is that we still haven't figured out a good way to protect small family farms, but beyond that there just aren't the great injustices Whoopi seems so concerned about. You can give yearly non-taxable gifts to your children (currently 13K), you can pay for their college, in many places you can co-own property that will then not be inherited and, as Chris says, you can simply spend the damn money before you die, and leave great sums of it to charity when you do.

This is what I do for a living, financial planning, insurance and investments. The uncertainty of the estate tax has been a big big problem for us and for our clients. How can we plan?

Is there still going to be a charitable deduction as we are used to? It seems not according to Obama. How much can we charge off against current income and is it worthwhile to even do that? Is the government going to continue to allow CRAT, CRUT, GRATs. Charitable lead trusts? Family Limited Partnerships?

What amount is the Unified Credit and Gift Tax exemption going to be in the future? 3 million, 1 million, 650,000? How much insurance will I need to cover estate taxes. What rate are estate taxes going to be?

Given the melt down in real estate values how much do I estimate a future estate that may consist of a lot of real estate holdings? Valuation of a small business? Farm and ranch land and the operation of the business?

Many estates are not in liquid assets that would allow the gifting of cash as the above suggested. How about capital gains? Is it better to sell the assets and take the cap gains now before the bit hit coming down the pike, or pass the asset at a stepped up value in the future? What if the step up in value feature is taken away (as has been proposed)

Sure, you can give away money to lower your estate, if you have liquidity or you can transfer assets. BUT.....Why should you have to give away your estate or impoverish yourself to avoid having the government take over 60% of it when you die?

When the Unified Credit Deduction is reset back to lower levels, you will see many many ordinary, not rich, people affected. It isn't hard to have an estate that is over a million dollars, especially if you own property in some States.

It isn't just the richy rich that are affected. It is practically anyone who has worked hard all their lives and made smart financial decisions.

You're not paying the estate tax, Whoopi. The recipients are.

Cold comfort. And how do they do that? Unless the dead person has planned properly(and most don't), the kids end up selling the family farm, the house, the business.... liquidate assets at fire sale prices and sell off investments to pay the Federal and State taxes.

Pogo said...

Whoopi just got mugged. If she remains a liberal, as I expect, she'll demand an exception to the rules because she's special.

If she awakens from her slumber, and recognizes perhaps for the first time that incentives matter, and that taxes have consequences she may have never envisioned, she may yet become a conservative.

jfx said...

AlphaLiberal is correct as a matter of empirically verifiable fact and SteveR is wrong and Joy Behar is correct as a matter of empirically verfiable fact since there is a multi-million-dollar exemption on estates subject to taxation.

I can't stress this enough. This isn't a question of philosophy of taxation or any other ideological-type dispute. There's a fair argument on that count.

It is just a fact that dead people do not pay taxes and it's just a fact that only the estates of the rich are subject to the estate tax.

sohereiam said...

Dust Bunny Queen --

Should't death and proper transference of one's assets take planning? I mean, since we've had property, one of the responsibilities we've had relative thereto is its disbursal once we've expired. And it's never been easy or certain! Look at the Bible!

You write as if these questions are too much for any one human to grapple with, but the truth is that it has always been difficult and uncertain, this dying with property and wealth on your hands thing. My family has been planning for years how to meet our obligations to one another and to the government and to be honest, it has forced us to confront certain questions I am glad were not left to be dealt with during a time of mournng. The government's presence in these discussions makes all the sense in the world, since certain people are about to come into wealth -- that is, income.


People who complain about this tax are uneducated about it or are whining.

Jason said...

Well, no. People who complain about this tax aren't uneducated and they aren't whining. That's bullshit. They're people who love their families.

Say I had someone who was doing all the right things, and among her planning steps bought permanent life insurance sufficient to cover the estate tax. Say he did it now, with the exemption set at 3 million on a 5 million dollar estate. Say she's not married, so there's no spousal exemption to take advantage of. Heck, let's just say it's Suze Orman, and the spouse is her same-sex life partner.

So she bought enough life insurance to cover about a 50% estate tax on the $2 million left over - or about $1 million. Actually, more than that, because if the insurance is in the estate that gets taxed, too (depending on who owns the policy. But let's just call it $1 million).

Ok, so she's got a plan in place. Except that Congress keeps changing the rules! So let's say Congress resets the estate tax exemption back to 500k. Well, maybe our friend can plan for that, simply by buying some more permanent life insurance.

So she undergoes a physical in order to buy life insurance and BOOM! She's got diabetes! Or a heart murmur. Or her blood pressure's through the roof. Or she's had cancer in the meantime. She can't get life insurance!

Even with proper planning, the estate tax becomes a tax on the sick, and a tax that falls disproportionately on gays and lesbians. Libtards gotta love that!

Joan said...

sohereiam: People who complain about this tax are uneducated about it or are whining.

Sohereiam, you've entirely missed DBQ's point. It is not that the planning for this disposition of your assets at your death is too impossible or difficult for ordinary people, and certainly this is something that has had to be addressed since the very idea of property first surfaced.

DBQ isn't saying that at all. What she is saying is that under the current administration, the uncertainty regarding which laws will stand and which taxes will be raised is very high. Financial markets and financial planning both suffer in periods of uncertainty, and under the Obama administration, we can add the feeling of dread. Impending doom may be hyperbole, but given that Obama's administration has demonstrated no comprehension of financial markets so far, you can't blame investment professionals for being both wary and pessimistic.

You can't decide what to do with your money if you don't know what the laws are going to be. A president who tinkers can do a tremendous amount of damage, as FDR did during the Depression.

matthew said...

DustBunnyQueen is exactly correct about the problems related to the estate and gift tax uncertainty. This uncertainty (the estate tax is set to repeal in 2010 and reset at 2001 levels in 2011) was created by a prior administration with the passage of EGTRA in 2001. Guess who was in office when that passed?

Jason, under estate tax law as it exists, people can pass millions tax free. Only the later millions are taxed. I haven't heard any serious discussion about changing that aspect of it. So spare me the "it hurts people who love about their family" claptrap.

Jason (the commenter) said...

Also, mayor Bloomberg was in the New York Post this morning complaining about how taxing the rich would hurt the city.

These people weren't complaining before the election, when it would have hurt Obama and made them look bad. Now they're all hedging their bets and trying to look like populists.

Smart people know, criticizing Obama pays.

sohereiam said...

Nonsense.

Joan, of course it's whining. We are going through a time of change! And I don't just mean the change Obama promised. . . . I mean, awful, dreadful economic change. The administration is doing about as well, in it's first seven weeks, as you could expect given the plate of shit it has been asked to eat. To complain about uncertainty right now is the very definition of whining. Everything is uncertain and we're all in the same boat.

And Jason, what utter drek. Are we really worried about your hypothetical friend? Is it really the most devastating scenario in the world, your story about someone with a five million dollar estate? I have no reserve of pity for her. My gosh, she still has dozens of options, exemptions, etc. And my gosh, what if her heirs do have to forgo some of that taxable $3-4.5 million? And what if things are a bit vague for a FEW MONTHS? Oh, the horror! I mean, the horror! The wealthy, for the most part, are indeed such whiners if this is really your best hypothetical!

I know just what stereotype I'm playing to right now -- militant liberal who has no pity for the working wealthy -- but I want to know, what happened to sober, responsible rich of yesteryear? The ones who knew what it looked like to complain about 80% tax rates during a time of national sacrifice.

My god, we are largely returning to Clinton era tax policies, with perhaps a tiny extra pinch on charitable gifts, and the wealthy are acting like it's off with their heads or onto the reeducation farms!

Mark said...

sohereiam: Joy is correct; this is a rich man's burden, though easily shouldered...

OK let me see if I can extract the moral principle you're advocating. Sounds something like this:

It's OK to take away the money of people who have a lot of money, because it won't hurt them much.

I see, property rights only apply to poor people. After you've earned a certain amount of money, the rest is up for grabs by people who feel morally superior to you. The normal, basic respect of recognizing that a person is entitled to keep what he honestly earns is suspended, and there is no need to even ask the person to voluntarily donate extra - because they might be too immoral or stupid to know that your big government causes are right. Therefore it's permissible to simply take it.

Would you apply that principle in any personal sphere of your life? Would you feel it right to simply take money from the wallets of other people because "they can afford it"? Would you teach a child that kind of moral lesson?

If it's not right for you to do it to another person yourself, how does it become right just because a bunch of looters like you want to do it to other people?

Jason said...

Matthew,

Your mojo on this topic is weak. You didn't grasp what I said, nor what DBQ said.

First of all, I SPECIFICALLY mentioned the current exemption in my post.

Second, for estate planning purposes, when it comes down to the rubber-against-the-road, eyeball to eyeball level, the real exemption is not "millions."

Why? Yes, the current exemption is 3 million, and I think it's unlimited next year. After which time, the estate tax exemption is scheduled, BY LAW, to revert to just half a million dollars.

One house in my area - South Florida - plus a decent IRA or 401k, or one closely held family business, or one good piece of rental property puts people wayyyyy over the top.

Now, none of the people I work with are currently expecting to die within the next two years. So, not being an ignorant piker, but someone who thinks ahead more than 24 hours, I have to base my planning assumptions not on what the CURRENT exemption is, but on what the exemption is GOING to be when the client dies - as best as I can guess it, anyway.

Right now, I have to assume that that exemption will be something close to $500,000 at life expectancy... which is the only time it counts.

Unless the client is on his or her deathbed, only a complete imbicile would try to use the current exemption to plan when the current law is set to expire in two years.

Jason said...

Sohereiam,

You're awfully liberal with other peoples' money, aren't you?

No, in this case, she doesn't have "dozens of options or exemptions" left. You're speaking out of ignorance. Ignorance and envy.

Not very becoming.

sohereiam said...

Mark --

It seems like you do not understand the debate -- I'm sorry if it has been over your head!

We're not talking about individuals keeping what they have earned. In this case, those individuals are dead. We're talking about a tax on the transference of wealth from a dead person to his living heirs, who really haven't done anything to earn the money at all, unless they were part of a family business, in which case, well, their compensation should have been taken care of.

You see, we're specifically not talking about taxing hard-earned money. We specifically talking about taxing un-earned money.

Also, by the way, in fact, my dear Mark! The entire progressive income tax is based on taking money from people's wallets based on who can afford it. Of course, there is also justice in the fact that those people are also the ones capitalizing the most off of the government's having built interstate highways, maintained domestic and international security, inspected the beef, provided comprehensive support for disease research, etc., etc. One's shipping company doesn't tend to prosper unless the ports are maintained, the treaty's respected, and so forth!

Jason said...

At any rate, the REAL highway robbery is the 80% tax rates effectively levied on anyone who inherits an IRA or 401(k), in a combination of estate and income taxes.

Watch Ed Slott explain:

http://www.youtube.com/watch?v=GSJoFaIy27c

sohereiam said...

Jason --

I actually have quite a bit of money, and so does the rest of my family! No envy to speak of in that regard, although a great deal in other regards -- I do wish I was a better dancer!

We're all planning on all kinds of ways to limit our taxable obligations, but most of us agree that this country oughtn't have a landed class of gentry who are able to pass millions and millions down through increasingly lazy and entitled generations of heirs who only fleetingly wonder why they were so lucky as to never have to work.

SteveR said...

SteveR is wrong

I am not. Joy Behar is an idiot, even when she's "correct".

Peter V. Bella said...

You're not paying the estate tax, Whoopi. The recipients are.

Wrong, asshat. The money was already taxed once. The estate tax is double taxation. The government gets very little from the tax. The only people who actually benefit from the tax lobbied hard to keep it were the estate planners and estate lawyers; you know, those evil special interests.

Andre said...

I guess I've always been confused about one argument for the estate tax:

If someone died and left me a billion dollars, wouldn't that be income and/or capital gains? Don't we already have taxes for those?

Revenant said...

"I already paid the tax. Why do I have to pay it again just 'cause I died?"

Because you voted for Barack Obama.

The better question is why *I* have to do it. I didn't ask for this. Whoopi did.

Revenant said...

It is just a fact that dead people do not pay taxes and it's just a fact that only the estates of the rich are subject to the estate tax.

It is never a "fact" that someone is rich. The term "rich" is subjective.

Radish said...

It promotes living people to consume rather than save.

This is how people end up dead broke and barely surviving on Social Security and Medicare for twenty or thirty years after they stop working.

This is how all those morons who "retire" to Florida at 60 and come crawling back to the Midwest dead broke at 70, expecting a state-subsidized rest home for the next ten years, end up warehoused.

It probably harms deadbeat rich kids more than anyone else.

Wow, that's ignorant. "Deadbeat rich kids"--I'm thinking of Kennedys, myself--inherit tax-free trusts and off-shore accounts.

The people who get harmed are the people who have small family businesses and farms.

We specifically talking about taxing un-earned money.

a) Dead wrong. The money was earned by the deceased.
b) Also, you have no idea what kind of unpaid work heirs have put into a family farm, or a family business, or advising their parents' investments, or caring for the decedent's health or house, etc. The money very well could have been "earned" over the years by the recipient.
c) What gives you the right to tell people what they can and cannot do with the money they have earned?

That's your whole argument--some people with money are doing things with it that you personally don't like, and you have some sick need to exert control. Envy? Some sort of family issue?

Mr. Forward said...

You can see them on the TV

Talking on "The View"

Every little issue

Is a morsel they can chew

They all loved Obama

But now his reign they rue

Cause he's pushing Whoopie's Cushion

And their coming after you.

Dust Bunny Queen said...

The reality is that the estate tax hits many who are in the middle class and who have assets that are now worth much much more than they ever dreamed, just through happenstance.

True stories and some are my relatives.

Like the LOL (little ole lady) who lives in a house in Pacific Grove on the ocean that she and her (now deceased husband) bought in the 1940's for a song, now worth millions, even in this depressed market. Thank GOD for Prop 13.

The rancher who inherited a dirt poor cattle ranch (of over 2000 acres) in the 50's that no one wanted because it was out in BumFuck Egypt..It is now worth 5 million dollars because fly fishing has become a popular hobby of the rich and famous. Houses on the 'river that runs through' the property sell for at the very least 1.5 million. Yet he can't sell it (even if he wanted to) because of the Williamson Act. He wants to leave it to his children and grandchildren, all of whom live and work on the ranch. We are doing a FLP.

The guy who bought empty lots in Carmel Valley in the 1960's when there was nothing but a dirt road out there because he was thinking of starting a commune. That didn't work out so well :-D , but now the property is worth millions. He can't sell unless he wants to take a monster hit on capital gains. He is utilizing some charitable giving and family giving techniques.....at least until they change the rules....once again.

Just explain to me why these people should be penalized over 60% of their estate value. They aren't "rich" in the sense of having tons of money to spend. In fact most of them live modest frugal lives and work at hard jobs. You try being a cattle rancher. They just got lucky and made some good decisions.

BY GOD...>>>>>They need to be punished!!!! They need to be taught a lesson. How DARE they accumulate wealth.

Planning will help minimize the estate transfer costs, but ....the government keeps changing the rules and moving the goal posts. You can't make plans when the rules are constantly changing.

For some people, by the time they realize that they need to plan, it is too late. Too ill, too old, spouse deceased and they lost the Unified Credit opportunity.

If someone died and left me a billion dollars, wouldn't that be income and/or capital gains? Don't we already have taxes for those?

Depends. Most estate items get a step up in value as of the DoD. Things like IRAs and annuities do not and you may have to pay income taxes immediately on the amount of the IRA (unless it is stretched) and on the annuity unless it is annuitized.

For example...Your parents bought a house in Carmel in 1945 and their cost basis is $35,000 but the appraised value is 2 million. When they die, your cost basis is now 2 million and if you sell for 2.2 million you only owe taxes on 200,000.

Your parents bought stock at $5.00 a share and it split multiple times over the years. Current market price of the stock may be $50.00 but your parent's cost basis is pennies. If they "give" the stock to you...you keep their basis. If you inherit it, stepped up.

The government was/is tossing around the idea of eliminating estate taxes but also eliminating the step up in value...in which case your cost basis would still be the 35,000 on a 2 million dollar property. How likely would it be that you would sell and pay 25% capital gains on the gain of the house or stock? Not likely!!! This would create a huge pool of stagnant assets from which the government wouldn't be able to take its pound of flesh.

I think the estate tax is robbery. However, it has provided me with a living. :-)

Darcy said...

Greatly appreciated the comments like DBQ's, Mark's, Revenant's, etc. And no, sohereiam, I am not uneducated. We simply disagree about who owns what to do with what they please. Big surprise to you? Not to me.

Freeman Hunt said...

Even if you want to take money from rich kids, what on Earth makes you want to give it to the government? As far as being spoiled, greedy, and just plain rotten, I'd say the government puts any brat to shame.

BJM said...

Perhaps an earning cap on the entertaiment, arts and sports industry would be far more productive than raising the margin 3% on couples earning $250,000?

The entertainment industry alone could contribute serious money to the treasury. Why are they allowed to amass billions. It just isn't fair. Their money needs to high on the redistribution list.

For example, why is Katie Couric's $15 mil a year any less onerous than a poorly performing Wall St company's CEO when her low ratings drag down CBS's value?

Or a producer/director who make an expensive flop? Publishers with failed newspapers?

Sauce for the goose.

Freeman Hunt said...

"Let's not give that money to that guy's kid. The kid didn't earn it. He'll probably do something stupid with it.

"Let's give it to the likes of Joe Biden and company. They'll put it to good use."

Are you kidding me? You almost may as well pass a law that upon death, half a person's assets will be put into a big pile and burned.

Freeman Hunt said...

And no, I'm not kidding. What are they using our money for right now? To pay off special interests. To buy themselves power. To encroach further and further into our lives. You want to give them more money to do this? No thanks.

Prosecutorial Indiscretion said...

It's distressing to see how many kooky-ass MetaFilter commenters bought the ludicrous story that the Santelli rant and the ensuing Tea Party activities were, as one put it, "all planned weeks in advance by right-wing billionaires."

Lem said...

"I tell you," he replied, "if they keep quiet, the stones will cry out".

Conservatism... (Yes Burkian, the one rejected by Eve Fairbanks) at its core cannot and will not be denied.

The idea of punishing success is (hopefully) still alien to most Americans, and it will remain so for time inmemorial!

sohereiam said...

Dust Bunny Queen --

What nonsense! I can't believe you, of all people, you who preach the gospel of Freedom and Independence, want to sway everyone with such sob stories!

These are exactly like the sob stories you all mock liberals for preaching, except your sob stories are about people who have come into money!

Why, exactly, should I have any pity at all for the Little Old Lady who comes into some money and then dies? Good for her! Now, her heirs have some taxes due. They can either sell the house and pay the taxes and keep the house and pay the taxes.

With income come responsibilities to your country, state and community. The income from inheritance should be no different, whether it is expected or not.

At this point, we're just arguing about whether or not income should be taxed. If you don't have the imaginative capacity to look at all the things we have like phenomenal public universities, a powerful military, strong public health, right down to the sewers, and trace all of that back to public expenditure of tax dollars, then you have my pity.

Windbag said...

Warren Buffett made tons of money off the death tax by going in and buying up family businesses bankrupt by the tax. He loves the death tax, because he can buy profitable businesses at pennies on the dollar. If Warren Buffett is for it, you know it's bad for the rest of us.

John Edwards whined about two Americas, Obama is doing his dead-level best to create it. The super-rich will remain. Those trying to crawl to upper-middle or lower-upper class are going to get crushed without some savvy planning over the next decade.

Methadras said...

Why stop at the death tax for double taxation. Look at the capital gains tax where you've taken your income, that has already been taxed, you invest it based on your own risk assessment into a vehicle that will get you some kind of return. And after you've realized that return and want to capitalize on it by cashing it out, you have to pay taxes on that. What a scam. I take all the risk with my money that has already been taxed by investing it and if I do good, the government is there saying, "uh, what about my 25%?" they did nothing. NOTHING to warrant that taxation. It's institutionalized and codified theft plain and simple. The death tax is just insult to injury, but capital gains is an offense to common decency.

sohereiam said...

Methadras --

Such silliness! The government has pretty much created the environment within which you created that new income. Do you think you would have a market to invest in were it not for the government? From the regulation that provides the safeguards necessary to have a stock market, to the infrastructure that makes it possible for American business to operate, to the educational opportunity the government provides so that we have an educated work force, the government has made it possible for you to create income through investment.

Grow. Up.

Freeman Hunt said...

If you don't have the imaginative capacity to look at all the things we have like phenomenal public universities, a powerful military, strong public health, right down to the sewers, and trace all of that back to public expenditure of tax dollars, then you have my pity.

And let's see, if we were just funding public universities, the military, public health (sans entitlements), and I'll even add in infrastructure, we could slash our taxes as they are now and wouldn't need a death tax. But instead we fund all sorts of absurd garbage and entitlements. If you don't have the capacity (doesn't even need to be "imaginative") to see how inefficient and wasteful your government is, you don't have my pity because you are a fool.

sohereiam said...

Freeman, dearest, you have my permission and encouragement to try and convince Medicare recipients, who adore their entitlement and vote in stunning numbers, that their entitlement is a waste. Go for it, dear, but I hope your feelings aren't hurt if they call you a fool!

The truth is, our largest entitlements are also our most popular -- social security, medicare. . . They are also just about a third of our federal budget, with military spending taking up quite a bit more than that.

Revenant said...

The government has pretty much created the environment within which you created that new income

Let's pretend, for the sake of argument, that that's true.

What you're ignoring is that we pay income tax. THAT is the reward the government gets for making it possible to accumulate wealth: it takes a cut. But as you have so frequently pointed out, the death tax isn't paid by the person who accumulated the money. It is paid by the inheritor. The government doesn't make inheritance possible. It doesn't facilitate it in any way, in fact. All it does is confiscate some of the money from the inheritor.

Synova said...

Should't death and proper transference of one's assets take planning?

No. It really shouldn't. A person should be able to say, *this* to so-and-so, and *that* to so-and-so, and *this other* to these people, and done with it, without having to bend in pretzles to keep a little bit of it away from the government after one dies.

Why do we accept this outrage that our property, real estate and wealth, business and investments, actually belong to the government should they decide to take it, and act as though it is our responsibility to jump to someone else's tune in order to retain a bit of what we've earned for the people *we* deem worthy of it?

Synova said...

I'm going to go back, now, to reading a very fun book in which the local crime boss's enforcer is setting about his rounds collecting "insurance" money.

'Ta.

sohereiam said...

Freeman, dearest, you have my permission and encouragement to try and convince Medicare recipients, who adore their entitlement and vote in stunning numbers, that their entitlement is a waste. Go for it, dear, but I hope your feelings aren't hurt if they call you a fool!

The truth is, our largest entitlements are also our most popular -- medicare, etc. . . They are also just about a third of our federal budget, with military spending taking up quite a bit more than that.

sohereiam said...

Revenant --

Inheritance is income.

BJM said...

sohereiam They can either sell the house and pay the taxes and keep the house and pay the taxes.

You are supposing they are wealthy, but in DBQ's example the value of the LOL's real property was accumulated over decades of appreciation, not personal wealth.

There are millions of older Californians who are real estate "poor".

I have friends who are in this situation with a family nut farm and commercial nursery that supports a large multi-generational extended family. All the heirs, their spouses and adult children work in the business and live on the land.

They will be forced to sell when their mother dies if the rates return to $500k.

These are not wealthy coupon-clippers, they work damned hard and have played by the rules. How is this fair?

They file as a Subchapter S Corp so they're about to have their taxes raised on the business earnings as well.

I think DBQ's point is that people must be able to count on a given tax scenario to plan for any financial event. Any sensible person expects interest rates and markets to vary. However shifting the tax ground under the feet of responsible, productive citizens is counterproductive short term thinking that produces a one time tax event instead of a continuing stream of revenue.

Bruce Hayden said...

Such silliness! The government has pretty much created the environment within which you created that new income. Do you think you would have a market to invest in were it not for the government? From the regulation that provides the safeguards necessary to have a stock market, to the infrastructure that makes it possible for American business to operate, to the educational opportunity the government provides so that we have an educated work force, the government has made it possible for you to create income through investment.

Someone is sure impressed with what they think that the federal government gives us. And because the government "gave" us all that, it owns the results of our hard work.

I think that this argument might be a little more credible, if so much of the government's expenditures weren't being used to buy power by trading government favors and payoffs for campaign contributions and lobbying fees for politicians' family and friends.

sohereiam said...

Bruce -- you miss the point entirely. We are the government, and it is through our investment that we have built the country.

Why don't you go on a government fast? Stop driving on the roads, pull out of the regulated markets, don't call the police if you need them. . . . see where it gets you.

Synova said...

The opposite of anarchy is not the pulling of forelocks in the face of "we" feeling entitled to the wealth created by the labor of others.

Peter V. Bella said...

With income come responsibilities to your country, state and community.

That is one of the most asinine and false statements I have ever seen. It rates right up there with Joe, "the moron", Biden stating that it is one's patriotic duty to pay taxes.

You people are really sick.

BJM said...

SSI and Medicare were not designed as "entitlements" but a safety net of self-funding pensions. Recipients paid for them in advance and by deductions on distribution. That Washington has managed the funds so badly that they are now liabilities should be a cautionary tale re universal health care.

Many warned for decades that they had become little more than generational Ponzi schemes as life expectancy lengthened, but were shouted down and called nasty names.

BTW- if it weren't for punitive tax rates many seniors would earn as much as possible as long as possible and actually continue to contribute to both general revenue and the SSI fund. $1 in benefits is deducted for each $3 you earn; for 2009 the limit is $37,680 for couples, $25,000 for individuals.
How is that sensible?

Another bit of Congressional idiocy is that if a senior can afford private health care insurance at age 65 they are penalized by a higher monthly premium when they eventually join Part B. Thus many take Part B earlier than necessary out of fear of not being able to make ends meet later. How does any of this gross mismanagement make any farging sense?

Joseph Hovsep said...

The estate tax is the single most sensible tax. No one should feel entitled to inherit unlimited amounts of money just because they were born into a wealthy family. And inherited wealth is among the least efficient uses of wealth. I'd support a much higher estate tax burden in exchange for a lower income tax.
I say we should tax money that is inherited by people without regard to whether they contributed anything to society before taxing compensation for the real work people do. And there are ways for those superrich who don't want their estates taxed to avoid estate tax: (1) spend the money while they are alive and (2) donate their estates to charity (and they can still give a few million to their offspring before the tax applies).

sohereiam said...

Peter V. Bella --

You too should go on a government fast!

sohereiam said...

Peter V. Bella --

Besides, where do you think the opportunities for income come from? They come from living in a healthy, safe, educated community. If we as citizens don't invest, through the government, in our nation and communities, we won't have an environment in which to grow business.

Peter V. Bella said...

sohereiam,
Every single citizen has the opportunity to pay higher taxes, even you. Just refuse to take all of your deductions and exemptions and pay 100% of the tax on your income. If you feel so strongly about people paying hiher and ridiculous taxes, then you can start with yourself. Or are you just another blathering hypocrite?

Chip Ahoy said...

... pay it again just 'cause I died

That's a very good question. The answer, according to the philosophy and social-view that caused you to vote for this man, is because your dead now and don't need it, and the government is so much better and smarter than your heirs at knowing what to do with the money you've earned, or anything you can think of whilst still alive.

Here's the way around that problem, get rid of everything you own in the years preceding your death in the manner of your own choosing. That way, there's nothing left for the government to take. Drawback: it takes a bit of planning.

mcg said...

A man walks up to a woman in a bar and says, "if I gave you ten million dollars right now, would you sleep with me tonight?" The woman says "Yes, I suppose so." The man says, "well, what about two hundred dollars then?" The woman is shocked! "What do you take me for!" The man answers: "Well, we've already established that you're a whore, now we're just quibbling on the price."

Arguments that the estate tax burden are unfair simply because the percentages are too high, or the exemption is too low, or because it represents double taxation just don't fly, because we don't consistently hold other taxation to the same standard. Progressive income taxation is "unfair", but most of us accept that. Double taxation of dividends happens, probably on a larger dollar scale than the estate tax, but that doesn't get much traction either.

Even if you reject unequal tax rates, what makes you think a flat tax is any more "fair"? You're still requiring those with lots of income to pay more in taxes, despite the fact that with high probability they use far less in government services than they pay. A truly "equal" tax scheme, in which every individual pays the same fixed amount, would never happen. Even eliminating the income tax and replacing it with sales or consumption taxes preserves the inequity.

I think we've accepted as a necessity that those with more wealth and income pay more towards the function of government than those with less .

So forget about fairness by the numbers.

The compelling cases for and against the death tax are purely pragmatic: the small business or family farm case, for instance. Well, I say, fix the pragmatic issues then. Is it really that hard to distinguish between liquid and semi-liquid inheritances and illiquid ones? Well, maybe it is, and maybe that is an argument against the death tax.

But fundamentally unfair? Nah, I'm not buying it.

Peter V. Bella said...

Progressive income taxation is "unfair", but most of us accept that.

Most of us are forced to accept that. There, fixed.

One of the founding constitutional principles of the United States was equality under the law. Somehow, when it comes to tax law, there is no equality.

mcg said...

So Peter, define for me what you consider a truly "fair" taxation system. How would you propose the government raise the revenue needed to operate. I suspect we agree it ought to need far less than it does, but I think we'd also agree it's not zero.

mcg said...

If you want to make an appeal to early U.S. history, revenues were generated from taxes on certain products (alcohol, sugar, tobacco, etc.). Was that "fair"?

Revenant said...

Inheritance is income.

But it isn't income that the government has any role in.

With income from jobs or investments you could perhaps argue that the government provides the necessary framework to make the economy possible -- police and so on. There's no need for a government for inheritance to work. People have been inheriting their parents' property since before governments were invented.

That's the point I was making. The government can't plausibly claim that it is owed some of the inherited money as a reward for its good deeds.

Ralph said...

but capital gains is an offense to common decency.
Especially when much of the gain is inflationary and caused by government.

Does anyone know if the federal Gift Tax also goes to 0 in 2010? If it's still 37%, that may be lower than the estate tax in 2011.

Ralph said...

Gibbon decried the confiscation of estates by the Roman Emperors, and it didn't do Richard II much good, either.

Revenant said...

If you want to make an appeal to early U.S. history, revenues were generated from taxes on certain products (alcohol, sugar, tobacco, etc.). Was that "fair"?

It was more egalitarian and more a matter of personal choice (since it is easier to avoid buying sugar and whiskey than it is to survive without earning income). Was it more fair? Dunno.

What makes the current tax system unfair is that the majority of tax revenue goes towards things which provide no benefit to the people paying the taxes. Sohereiam has claimed that the government makes it possible to earn an income, but very little of what the government spends can plausibly be said to serve that purpose. Seventy percent of the budget goes to health care, Social Security, discretionary spending, and interest on the debt. That leaves thirty percent for the useful functions of government, and frankly most of the thirty percent is wasted too.

So while an income tax might not be inherently more unfair than an excise tax on alcohol, a tax levied for the purpose of hiring more useless government workers is certainly more unfair than a tax levied to support the minimal government of 18th century America.

mcg said...

(since it is easier to avoid buying sugar and whiskey than it is to survive without earning income).

Alcohol sure---but with sugar you're talking about not just sugar but any products made with it.

What makes the current tax system unfair is that the majority of tax revenue goes towards things which provide no benefit to the people paying the taxes.

I think we're arguing semantics here but it's an important semantic distinction. It's not the tax code's "fault" that the government spends money on things that it shouldn't (and you and I would probably agree in a *lot* of specific areas).

I think it is reasonable to decouple the discussion: given that the government intends to raise $X, what is the most fair way to go about it? That $X is way too much is a different matter, one on which we agree.

But if you insist: suppose hypothetically we dropped that 70% of government function that shouldn't be there in the first place. What would be the most fair way to pay for it? Some here are even insisting that inheritance tax is one of the first places we should go. I don't know if I agree with that score.

cubanbob said...

" Blogger Joseph Hovsep said...

The estate tax is the single most sensible tax. No one should feel entitled to inherit unlimited amounts of money just because they were born into a wealthy family. And inherited wealth is among the least efficient uses of wealth. I'd support a much higher estate tax burden in exchange for a lower income tax.
I say we should tax money that is inherited by people without regard to whether they contributed anything to society before taxing compensation for the real work people do. And there are ways for those superrich who don't want their estates taxed to avoid estate tax: (1) spend the money while they are alive and (2) donate their estates to charity (and they can still give a few million to their offspring before the tax applies).
6:34 PM"

Spoken like a true parasite. Hate to bust your commie fantasy but the super rich avoid the death tax. They just shift the money offshore, like the Kennedy's. Here is one example for you to choke one, a number of years back a family that would have faced paying 5 billion in inheritance taxes simply sold and moved their assets abroad, walked in the the US Embassy in said country and renounced their US citizenship. You think that is good for the country?

No, the ones who get the shaft are the not so rich who just can't cash out and move their assets, they just get screwed to fund benefits for parasites like you.

The money does not belong to the government or society or some amorphous entity. It belongs specifically to those who have earned or those who have specific title to it. The death tax has never been effective in raising revenue for the government, it is and always was a scheme to level incomes. Not the proper role of government or taxation.


" Blogger sohereiam said...

Freeman, dearest, you have my permission and encouragement to try and convince Medicare recipients, who adore their entitlement and vote in stunning numbers, that their entitlement is a waste. Go for it, dear, but I hope your feelings aren't hurt if they call you a fool!

The truth is, our largest entitlements are also our most popular -- social security, medicare. . . They are also just about a third of our federal budget, with military spending taking up quite a bit more than that.

5:41 PM"

First I did not vote for FDR so I don't see why I have to be stuck with his Ponzi scheme. Secondly the government sends me this annual forms of just how much my contributions to the social security trust fund is and my lifetime to date contributions. So are you saying the government is lying to me, that I have no vested property rights to the money I paid in to the fund? Gee even with this shit market my lifetime contributions along with that of my employer (myself) is already greater than I would get at retirement age and I still have 15 more years to go. And that doesn't include the money I have paid for my other employees over the years. Bush screwed up, he should have fought to the end to privatize social security and killed of Freddie and Fannie Mae along with the laws pushing banks to loan to the hopeless credit risks and not making the tax cuts permanent.

MCG " Even if you reject unequal tax rates, what makes you think a flat tax is any more "fair"? You're still requiring those with lots of income to pay more in taxes, despite the fact that with high probability they use far less in government services than they pay. A truly "equal" tax scheme, in which every individual pays the same fixed amount, would never happen. Even eliminating the income tax and replacing it with sales or consumption taxes preserves the inequity.

I think we've accepted as a necessity that those with more wealth and income pay more towards the function of government than those with less ."

And what exactly is wrong with a head tax? You made a great case for it. The theory of government is we are all equal under the law and the government provides its national defense, law enforcement and other functions equally to all, so why not a head tax? Just because as a matter of expedience those with more are compelled to pay more does not legitimate the matter. Using your logic voting ought to weighed by the amount of taxes paid. The more you pay the more your vote counts. Its only fair and proper don't you think?

Peter V. Bella said...

So Peter, define for me what you consider a truly "fair" taxation system.

Let us start with all citizens paying taxes, including the poor. Welfare and food stamps should be considered income. If I Ihave to pay then everyone has to pay. Equality under the law!

Synova said...

No one should feel entitled to inherit unlimited amounts of money just because they were born into a wealthy family. And inherited wealth is among the least efficient uses of wealth.

Someone else mentioned that spending was better than hoarding...

It all depends.

Would you bother to build wealth beyond your immediate needs if you didn't know that it would enrich those you love? Would you build a business? Would you build a legacy?

It's better, by far, to have a system that works *with* human desires rather than against human desires.

Children do not have a *right* to inherit from their parents any more than parents have a *right* to be supported by their children, yet I'd argue that expectations of either are far more healthy for society than a situation where neither is expected.

It's no wonder that society in the form of government, has to carry such a tremendous burden of welfare, because the natural systems of providing that support are subverted.

Revenant said...

Alcohol sure---but with sugar you're talking about not just sugar but any products made with it.

Sure, but it isn't a dietary staple. I'm not saying it was easy to avoid paying those taxes, just that it was easier than living without an income is.

It's not the tax code's "fault" that the government spends money on things that it shouldn't (and you and I would probably agree in a *lot* of specific areas).

The people who author the tax code are the same people who determine how the money is spent. The income tax system we have in place was PUT in place specifically because Congress knew it needed a source of lots of cash for the aforementioned spending.

given that the government intends to raise $X, what is the most fair way to go about it?

The answer would be to raise the money from the people who benefit from the government programs the $X is needed for. That doesn't make sense in the case of wealth transfers (which is the majority of what the government does), but the federal government isn't supposed to be in that business in the first place.

Revenant said...

No one should feel entitled to inherit unlimited amounts of money just because they were born into a wealthy family.

Of course not. But every single American should feel entitled to complete control over who their accumulated wealth goes to when they die.

That's what proponents of the death tax doesn't get. We're not a bunch of trust fund kids worried that we might not get enough money when mom and dad kick the bucket. We're ordinary Americans who want our hard-earned wealth and property going to the people we cared about, instead of paying for some Congressman's kickbacks, or some crack whore shitting out another half-dozen kids, or whatever "better" use the government would like to put it to.

The government puts barriers in place to prevent me from transferring most of my property when I'm alive (the limit for tax-free gifting is pathetically low) or when I'm dead (the death tax). Not only does it make it hard to accumulate wealth by confiscating over half our incomes, but we can't even do it for a higher purpose than meeting our own personal selfish needs.

Bah.

Methadras said...

sohereiam said...

Methadras --

Such silliness! The government has pretty much created the environment within which you created that new income.


Really? What seems silly here is your presumption that you actually know what you are talking about. The government created the stock market? It created free trade, commerce, enterprise, and entrepreneurship? I must have missed that memo. Oh, do tell me when that happened so I can go back and read the historical perspective on it.

Do you think you would have a market to invest in were it not for the government?

Again, you are going to have to enumerate when and where the government created a free market, much less a stock market. You've said nothing in specificity other than trying to sound profound and create a smokescreen of an opinion that isn't even rooted in fact.

From the regulation that provides the safeguards necessary to have a stock market,

The SEC was created (in 1933) to induce fair play on the stock market and to help avoid cheating (this is an oversimplification since I'm trying to keep it simple for you). They are ineffective and in certain aspects downright incompetent.

to the infrastructure that makes it possible for American business to operate, to the educational opportunity the government provides so that we have an educated work force, the government has made it possible for you to create income through investment.

Absolutely meaningless piffle. The government has done nothing but become a regulating body for how wealth is taxed and distributed. I am who is responsible for creating income through MY investments and the exchange of my life force for monetary compensation. Not the government. The government simply waits by the way side and apportions their 'legal' due from that exchange of commerce that I initiated with my employer or with my client(s). Not the government.

You've completely lost the point of my comparative of the death tax to something like the capital gains tax. You simply do not understand it because it doesn't take much from what you wrote to determine that you are completely clueless about it.

I created that income because I took the risk to already take my post-tax dollars and put it somewhere where I think will make me more dollars. The government has no business in that decision making process, nor do they have a role in that risk that I took with those post-tax dollars. So when they ask for their 'cut' of that newly created income from those post tax dollars, they are in essence taxing me twice. That is illegal.

Double taxation of investment returns from already taxed income, coupled with a tax on inflation cause capital gains to go well beyond tax rates on my already post-taxed income. Which makes capital gains an insidious device for taxation.

What makes capital gains taxation such an insidious device is that it taxes inflation, because capital gains are not adjusted for inflation. Can you possibly even understand the implication of that alone? I doubt it, but maybe you go learn something before you offer up your meandering pretentiousness again.

Grow. Up.

Been there, done that. It's your turn.

downtownlad said...

This is what I do for a living, financial planning, insurance and investments. Dust Bunny Queen

Yet DBQ is so freaking stupid that she thinks that you are stealing from the bank when you sell your house or refinance.

Dumbass.

downtownlad said...

Of course not. But every single American should feel entitled to complete control over who their accumulated wealth goes to when they die. - Revenant

Except faggots of course.

Revenant said...

Grow. Up. Been there, done that. It's your turn.

Let's be realistic here. There's a simple reason why the death tax exists: the people it applies to are outnumbered by the ones it doesn't. We live in a democracy, which means the minority always takes it up the ass unless there's something in the Constitution to prevent it. And usually even then.

We can spin stories about what's right or moral or fair or all that other happy horseshit. But the reality is that might makes right, at least so far as the law goes.

And that's why we have a death tax.

mcg said...

The answer would be to raise the money from the people who benefit from the government programs the $X is needed for.

You're avoiding the question, I think. National defense benefits everyone. How shall the money to fund it be raised?

Freeman Hunt said...

Freeman, dearest...

I'm your dearest? How flattering.

The truth is, our largest entitlements are also our most popular -- social security, medicare. . .

And that's a reason to support them? I don't.

They are also just about a third of our federal budget, with military spending taking up quite a bit more than that.

You are incorrect.

Gar said...

"I actually have quite a bit of money, and so does the rest of my family!"

So, dearest sohereiam, you're rich?

Then be a good liberal. Write an extra check this April 15 to those who know better than you how to spend your money.

sohereiam said...

But gar, dear, I do! Taxes paid in full. . . And I think about my contribution for good or for ill -- the roads, the wars -- and know that a mark of maturity is understanding that it all has to be paid for.

Sometimes with you people. . . it's like one has to explain representative democracy -- the consent of the governed, etc. etc. Your odd notion that the government is somehow someone else. . . I don't know.

sohereiam said...

Freeman -- please note this is a Bush era notion, not putting spending for our wars in Iraq and Afghanistan in the pie chart. When one does that, my dear and darling, one sees quite a different picture.

And my only point in noting how popular our entitlement programs are is that you are in such a small, small minority that it is rather beside the point to indulge in any discussion of whether or not they are a waste. To the vast majority of the country, they are not a waste, and any effort to cut them from our spending is dead before it gets out of bed.

sohereiam said...

Methadras --

Yes, yes, you are an Island. Stunning achievement, that.

Jason said...

Sohereiam,

What deductions did you claim on your taxes last time you filed?

And as a percentage of AGI, what was the additional amount you donated to the treasury over and above your taxes due?

Or are you a tax chickenhawk?

Paul Snively said...

sohereiam: Besides, where do you think the opportunities for income come from? They come from living in a healthy, safe, educated community. If we as citizens don't invest, through the government, in our nation and communities, we won't have an environment in which to grow business.

All it takes to make this correct is to remove "through the government." And there is the entirety of the difference between those who wish to see free people engaging in sustainable commerce, which includes not only the possibility, but the guarantee, that many businesses will fail, and those who wish to see more government, which has a long history of enacting policies that result in, or at best prolong, asset bubbles, credit crunches, recessions, depressions, and the destruction of entire markets, as the current administration is doing quite successfully to the stock market.

If we're lucky, we'll learn our lesson this time, abolish the GSEs, and slash government spending to 1929 levels, at which point federal expenditures were approximately 4% of GDP, vs. the nearly 38% that are estimated for fiscal 2009. If we were really smart, we'd abolish the federal reserve system and end fractional reserve banking in this country. No more artificially low interest rates, no more inflationary monetary policy.

What the government worshippers consistently forget is just how much of our government didn't exist until relatively recently. Federal income tax? The sixteenth amendment was ratified in 1913. How did the federal government receive revenue prior to that? The federal reserve system: ditto 1913. The criticisms section of the federal reserve's Wikipedia page has some excellent summaries and quotes. Before there was a federal reserve system, America had a free banking era; see here.

A more distributed political and economic system weathers various socioeconomic shocks much more ably than a heavily centralized one. This lesson has been well absorbed by many who were formerly under the Soviet jackboot, in central and eastern Europe. But America, which started as the antidote to monarchy and central authority, has gradually eroded its own freedom and resilience, heading in precisely the wrong direction.

My only glimmer of hope at this point is that the current administration will screw things up so severely that the electorate finally recognizes the need, not to reset to the Bush years or Clinton years or Reagan years, but to the very early 20th century, before we had allowed the government to create so many of the conditions that keep us frequently poor and, even more often, uncertain.

rcocean said...

"They just shift the money offshore, like the Kennedy's. Here is one example for you to choke one, a number of years back a family that would have faced paying 5 billion in inheritance taxes simply sold and moved their assets abroad, walked in the the US Embassy in said country and renounced their US citizenship. You think that is good for the country?"

No, which is why we need to rewrite the tax law to present the greedy parasites from avoiding the tax. We could easily work out an international arrangement to tax billionaires who move money offshore.

If the super-wealthy want to leave the country and become Swiss, who cares? Good riddance to bad rubbish.

Dust Bunny Queen said...

Inheritance is income.

No it isn't.

Try to distinguish between assets and income.

Yet DBQ is so freaking stupid that she thinks that you are stealing from the bank when you sell your house or refinance.

?????? Huh?


"Of course not. But every single American should feel entitled to complete control over who their accumulated wealth goes to when they die. - "

DTL: says except faggots of course.

Hey DTL.... even faggots can plan their estates. Even asshole faggots like you. No one is stopping you.

Methadras said...

Revenant said...

Let's be realistic here. There's a simple reason why the death tax exists: the people it applies to are outnumbered by the ones it doesn't. We live in a democracy, which means the minority always takes it up the ass unless there's something in the Constitution to prevent it. And usually even then.

We can spin stories about what's right or moral or fair or all that other happy horseshit. But the reality is that might makes right, at least so far as the law goes.

And that's why we have a death tax.


Nature abhors a vacuum. So does government. And as opportunistic as government is to optimize it's ability to find at every opportunity a way to divest already taxed dollars from those that it originally taxed it from is what is at issue here. Sure, we can spin things to be have more moral or even indignant tone to how government finds ways to deincentivise productivity, profit, and innovation, but the truth of the matter is, is that it is wrong no matter how it's legally couched. The death tax is an offensive tax on it's face and furthermore it's an illegal tax on top of that. I may never qualify for it anyway simply because I'm not in the bracket for it to apply, but the mere thought that upon my death that the government is entitled to 55% or whatever it is to value of my estate after a set amount of millions is frankly wrong. That's it all I have to say about that. However, I do understand what you are saying and to a degree I even sympathize with it, but the overriding argument here is that on a certain level, people know when a tax like this is just wrong and if someone like Whoopi Goldberg can come to that conclusion as well, then there is hope that this sentiment will spread beyond just here disagreeing with it.

Jason said...

Jaysus!

Why in God's name would ANY country want to work out an agreement that discourages billionaires from moving themselves and their fortunes to their country?

Is there no end to progressive, leftard stupidity? Have you really not grasped that you liberaces ought to be trying to figure out how to encourage creators of wealth to STAY, not demonize them and drive them offshore.

Capital flows where it is treated best. We'd better make site that the US stays on the short list.

Methadras said...

sohereiam said...

Methadras --

Yes, yes, you are an Island. Stunning achievement, that.


Maybe so, however the fact that you are incapable of even responding with a refutation of something like the capital gains tax and instead resort to the typical ad hom only speaks volumes to your cluelessness about the issue.

rcocean said...

"Jaysus!

Why in God's name would ANY country want to work out an agreement that discourages billionaires from moving themselves and their fortunes to their country"


And is there any end to *your* stupidity? What do think Billionaires do, travel around with a truck full of money, from country to country.

Most Billionaires own stock, business, and land. These assets don't move with their physical presence. Billionaires live where they live for a variety of reasons.

Maybe you should read some books. Or go kiss Bill Gates' ass.

Freeman Hunt said...

Freeman -- please note this is a Bush era notion, not putting spending for our wars in Iraq and Afghanistan in the pie chart. When one does that... one sees quite a different picture.

So, shall we add these trillions in bailouts and "stimulus" to the chart? I think that would be a good idea. A different picture indeed.

Popular or not, the entitlements are wrong, and we should be talking about them.

And just to make sure things are straight between us, I'm not your dear, and I'm not your darling.

Jason said...

rc, you moron.

You just argued that billionaires move money offshore, and argued that we could work out a deal with other countries to prevent that.

Now you're arguing the exact opposite.

But if you knew what you were talking about, you would know that irrevocable trusts in foreign jurisdictions is an extremely common tool for wealth protection among the wealthy.

The billionaire doesn't neccessarily own the land, stock or business, moron. A trust can own it, and the trust can be set up in any jurisdiction in the world.

The wealthy move their money offshore every day. And under Obama, watch it become a flood.

Not for income tax avoidance, because that's illegal, but to shelter it from idiot tort lawyers and moron judges. (But the government won't be collecting an estate tax on those assets, because trusts don't die.)

These billionaires don't have to travel around from country to country, you dolt, because they can move their assets to the Cayman Islands, irrevocably, with the stroke of a pen.

And the Cayman Islands loves it when they do that. They won't be cutting a deal with the US.

UBS has been in the news recently for precisely that (although UBS seems to have broken US law)

sohereiam said...

Dearest, darling Freeman, it is certainly not for you to decide whether or not you are my dear or my darling! Such affection resides in my heart, not yours!

And, mon cherie, you can talk all you want about entitlement spending, and I'm all for some reform when it comes to Social Security, or really any thoughtful reform. . . but your radical libertarianism is such a small, small blip in the field of public opinion when it comes to the biggest -- and most effective! -- programs, I fear any discussion of them outside a circle of off-the-gridders would be misdirected passion indeed!

Ta ta for now, dear heart!

sohereiam said...

Methadras --

Not really -- it speaks to my boredom with this thread!

As for cap gains, I'm in favor! It taxes income on investment, not the seed money that has already been taxed. This is a point so patently obvious, I felt bad bringing it up.

I can't really be expected to respond seriously, anyway, to people who don't have serious gratitude for the social contract and the meaningful government it has produced.

Freeman Hunt said...

Dearest, darling Freeman, it is certainly not for you to decide whether or not you are my dear or my darling! Such affection resides in my heart, not yours!

I see you've fully embraced the condescending use of pet names. Such a common refuge for weak men. The weak sort of men who think the philosophy of "social contract" somehow implies that the State should act as Great Mother. The weak sort of men who would give up their freedom for Her imagined beneficent embrace. The weak sort of men who champion collectivist sentiment.

Also, the weak sort of men that I don't bother with. We're done.

rcocean said...

"You just argued that billionaires move money offshore, and argued that we could work out a deal with other countries to prevent that.

Now you're arguing the exact opposite."

No one wasn't. I was making the point that its extremely difficult for the super-wealthy to avoid estate taxes by moving to other countries because the assets themselves are easily identifiable and can't be moved. It doesn't matter if Bill Gates personally moves to Cayman Islands. His wealth is MSFT and as a US citizen he is subject to US tax laws.

As for foreign countries refusing to help us tax the wealthy - pressure can be applied and carrots dangled. These countries -tax havens like Cayman - are small & can be pushed around.

stepskipper said...

Mrs. Bernstein? Your driver is here.

sohereiam said...

Freeman! Done? Really?

Tonight, I shall put some Brahms on the Victrola, sit uncomfortably in my favorite Windsor back chair, and stare at a blank wall until the sun comes up. I won't ask for your forgiveness, because I know I don't deserve it. Instead, I will wallow in a soup of my own weakness and the bitter tears I am already crying.

Has any man lost a hundred suns? Has any man lost the seven seas? Nay, bring me the man who lost Paradise itself. If you can find this man, then you will have found my only fellow, the only one who can understand my loss.

Freeeeeeeeeeman!!!!!!!

Jason said...

"Countries are small and can be pushed around."

No. They are sovereign entities. And NONE of these countries commonly used for asset protection trust domiciles has honored a charging order from a U.S. court to break a trust held in their jurisdiction.

The moment one does, capital will leave their shores with a giant sucking sound.

And yes, capital can be moved offshore, no problem. Even MSFT shares. It happens every day.

mcg said...

That is approximately the right posture, SoHereIAm.

cubanbob said...

" rcocean said...

"You just argued that billionaires move money offshore, and argued that we could work out a deal with other countries to prevent that.

Now you're arguing the exact opposite."

No one wasn't. I was making the point that its extremely difficult for the super-wealthy to avoid estate taxes by moving to other countries because the assets themselves are easily identifiable and can't be moved. It doesn't matter if Bill Gates personally moves to Cayman Islands. His wealth is MSFT and as a US citizen he is subject to US tax laws.

As for foreign countries refusing to help us tax the wealthy - pressure can be applied and carrots dangled. These countries -tax havens like Cayman - are small & can be pushed around.
7:04 PM"

Keep dreaming. Never. Going. To. Happen. If for no other reasons politicians also like to pass on their wealth to their families; ie; the Kennedy's.

Perhaps you do not understand things like trusts, bearer bonds and all the possible ways to shelter money and title. Besides who is to say the super rich may not decide to cash out before they die and move their capital abroad? Its been done before.

" Blogger sohereiam said...

Freeman, dearest, you have my permission and encouragement to try and convince Medicare recipients, who adore their entitlement and vote in stunning numbers, that their entitlement is a waste. Go for it, dear, but I hope your feelings aren't hurt if they call you a fool!

The truth is, our largest entitlements are also our most popular -- social security, medicare. . . They are also just about a third of our federal budget, with military spending taking up quite a bit more than that.

5:41 PM"

Truly not only are you smug and arrogant but stupid to boot. Your premise is not the rule of law but mobocracy. Except what happens when those with the bucks decide not pay? And those with the bucks to pay the big taxes are also the ones with the cash to buy the bonds that finance the parasite state. What makes you think they will keep on buying those bonds especially at the rate Odumbo the Communist is pissing away money on the parasites?
You really believe those people are too dumb to see the writing on the wall, that Hussein is converting US Treasuries in to junk bonds? Keep dreaming and start paying the maximum rate with no deductions because soon enough if you have any form of income you by virtue of the mobocracy will be the rich guy.

DTL I hate to disillusion you but even fagots have the right to will their money to those they love irrespective of orientation. And your loved ones, do they deserved to be robbed of the money you willed them after you legally earned it and paid taxes on it while alive?

Jason said...

The more taxes they pay, the fewer bonds they can buy. You watch... that is going to SEVERELY restrict the ability of private entities and municipalities to raise capital. Especially private activity municipal bonds, which don't qualify for federal income tax exemption under the AMT.

The massive bond-financed federal spending is going to choke off much-needed capital for technological innovation, health care, transportation, infrastructure, space exploration, national defense, new construction, the creation of a meaningful market for mortgage paper, car loans, home loans, small-business loans, and EVERYTHING else you'd care to name.

People have NO IDEA that capital pools are limited. Government money isn't free - and even if it's debt financed, that capital has to move OUT of something in order to move IN to treasuries.

God forbid we have a megacat disaster soon that will force us to draw upon reinsurance pools.

Jason said...

Minor point:

Faggots can will their property to whom they want, but until they are allowed to marry, they are NOT entitled to the unlimited spousal estate tax exemption under the law.