Proposed "death tax" may kill the family farm?

[Nite Hawk]

Read how the US government is proposing to change the "death tax" on farms and businesses and according to the article may put alot of people out of business.
Does anyone know if this is true??

http://theeconomiccollapseblog.com/arch ... r-children

 

[highgrit]

" the blind leading the blind " Sad but true. Well there's ways around everything when it comes to taxes. The farmer or rancher is going to lose big time if they haven't taken the time to put their land in trusts or holdings or some other LLC. And do what should of been done years ago. We are in a mess now and it's only going to get worse for the next 4 years.

 

[Jogeephus]

I agree there should be a death tax but the exclusion limit should go back to what it once was when it was first passed then adjusted for inflation. Ie In 1865 there was a $1 million exemption and the tax rate was a max of 15%. Since that time it has grown to as high as 77% and in a state like Georgia where we also have a 6% state death tax this works out to 83% of your assets. Assets that you have already paid taxes on to acquire. Just a few years ago the republicans promised us the complete repeal of this if they were given control. They were and they didn't. Apparantly neither party is willing to make this right or fair so once again both parties are putting the screws to the taxpayer.

 

[CottageFarm]

Death, or colloquially referred to, inheritance taxes are evil. As you mentioned Jo, most of the assets have already been aquired with after tax monies. I've never understood why the transfer of assets needs to be taxed when there is no monetary gain in the transfer.

 

[cow pollinater]

I've never understood why the transfer of assets needs to be taxed when there is no monetary gain in the transfer.

Unfortunately, I understand it... It's a money grab. Pure and simple. What I DON'T understand is why the government feels entitled to it.

 

[Anonymous]

What was that phrase again...






I remember now. "Taxation without representation"

 

[Nite Hawk]

TAX POEM

Tax his land, tax his wage,
Tax his bed in which he lays.
Tax his tractor, tax his mule,
Teach him taxes is the rule.
Tax his cow, tax his goat,
Tax his pants, tax his coat.
Tax his ties, tax his shirts,
Tax his work, tax his dirt.
Tax his chew, tax his smoke,
Teach him taxes are no joke.
Tax his car, tax his ass
Tax the roads he must pass.
Tax his tobacco, tax his drink,
Tax him if he tries to think.
Tax his booze, tax his beers,
If he cries, tax his tears.
Tax his bills, tax his gas,
Tax his notes, tax his cash.
Tax him good and let him know
That after taxes, he has no dough.
If he hollers, tax him more,
Tax him until he's good and sore.
Tax his coffin, tax his grave,
Tax the sod in which he lays.
Put these words upon his tomb,
"Taxes drove me to my doom!"
And when he's gone, we won't relax,
We'll still be after the inheritance TAX!

Author Unknown

 

[CottageFarm]

CP - Yup. They think it's all theirs to do with as they please. Just ask 'em.

Hook - Somebody keeps voting for their azzes.

Nitehawk - that about covers it... so far anyway... :frowns:

 

[I luv herfrds]

I hate saying it but we lucked out that both my inlaws passed away when the inheritance was not in effect. We talked with our tax preparing and our inheritance tax bill would have been $450,000.00
Had some smart azz tell me since we were part of the 1% we should have paid that bill.

 

[3waycross]

I hate saying it but we lucked out that both my inlaws passed away when the inheritance was not in effect. We talked with our tax preparing and our inheritance tax bill would have been $450,000.00
Had some smart azz tell me since we were part of the 1% we should have paid that bill.

My buddies, folks attorney told him the same thing. She no longer works for them!

 

[Limomike]

Read how the US government is proposing to change the "death tax" on farms and businesses and according to the article may put alot of people out of business.
Does anyone know if this is true??

http://theeconomiccollapseblog.com/arch ... r-children

Yep... another one of those "taxes" that just isnt right.

 

[cow pollinater]

Part of their rational is that the family member who built the inheritance did all of the work and so the children have no real investment into the property and should therefore be taxed on their new wealth... Raise your hand if you never had to work for your parents for free...
I've carried my work ethics into my adult life so I don't have to have an inheritance to make me wealthy but I D!@# sure have enough unpaid labor hanging out there(and I'm still doing quite a bit of it at 34 and it's turning into more as he ages) that I can say that my father's property should belong to me when he's gone. We hated each others guts for about ten years and I still worked for him for free.

 

[TexasBred]

Part of their rational is that the family member who built the inheritance did all of the work and so the children have no real investment into the property and should therefore be taxed on their new wealth... Raise your hand if you never had to work for your parents for free...
I've carried my work ethics into my adult life so I don't have to have an inheritance to make me wealthy but I D!@# sure have enough unpaid labor hanging out there(and I'm still doing quite a bit of it at 34 and it's turning into more as he ages) that I can say that my father's property should belong to me when he's gone. We hated each others guts for about ten years and I still worked for him for free.

I thought that was somewhat normal. IF mine were still alive I'd still drop everything if he called. Don't think we ever had any hate but he sure interfered with my plans a lot. :lol2: He use to laugh and say he back me 3 and a half a day....three meals and a half a bed. :???:

 

[Jogeephus]

I believe we should have a death tax for the simple reason that without it some families would gobble up so much of the land and resources that the average person would not have a chance at owning property. In the late 1800's the exemption was a million dollars. This was a pile of money and you could buy about anything you wanted. Not adjusting this exemption for inflation is criminal in my opinion because a million dollars today is not that much money when you start adding up over-inflated land prices and equipment and all. Maybe someone can figure out what $1 million in 1867 dollars would be in today's dollars. This is what it would be if the law was kept true to what they agreed to in the first place.

 

[SSGenetics]

I believe we should have a death tax for the simple reason that without it some families would gobble up so much of the land and resources that the average person would not have a chance at owning property. In the late 1800's the exemption was a million dollars. This was a pile of money and you could buy about anything you wanted. Not adjusting this exemption for inflation is criminal in my opinion because a million dollars today is not that much money when you start adding up over-inflated land prices and equipment and all. Maybe someone can figure out what $1 million in 1867 dollars would be in today's dollars. This is what it would be if the law was kept true to what they agreed to in the first place.

$15,384,615.38 according to the inflation calculator....

 

[Nite Hawk]

I am thinking that like Highgrit said, one might be able to incorparate into a company or trust fund to be able to pass on your business or farm to who ever you want without them losing their shirt in "death taxes".
Wonder if joint ownership might help with the tax question. I have heard of signing property over to someone else with the legal right to remain on the property till death, but I guess that might be "tricky" depending on who it is signed over to.From what i have heard land trusts or co-ops might be ones best bet depending on the laws in ones area.
I guess only a real good lawyer could answer those questions, depending on where you live.
Finding a lawyer who would tell you might be a problem too, as they usually make a "killing" on estate fees once someone is gone, so they may not want to tell you what you want to know...

As the old saying goes, Tax avoidance is legal, Tax evasion isn't legal and one can spend time in the "crowbar" hotel with tax evasion..
Nite Hawk

 

[glacierridge]

I've never understood why the transfer of assets needs to be taxed when there is no monetary gain in the transfer.

Unfortunately, I understand it... It's a money grab. Pure and simple. What I DON'T understand is why the government feels entitled to it.

There is a lot of entitlement issues going on these days...
Sad part is it's the farmers that usually get screwed the most in the deal.

 

[Jogeephus]

I believe we should have a death tax for the simple reason that without it some families would gobble up so much of the land and resources that the average person would not have a chance at owning property. In the late 1800's the exemption was a million dollars. This was a pile of money and you could buy about anything you wanted. Not adjusting this exemption for inflation is criminal in my opinion because a million dollars today is not that much money when you start adding up over-inflated land prices and equipment and all. Maybe someone can figure out what $1 million in 1867 dollars would be in today's dollars. This is what it would be if the law was kept true to what they agreed to in the first place.

$15,384,615.38 according to the inflation calculator....

Thanks. Using that as the exemption limit would put the law back to its original intent and accomplish what it was originally meant to do. Its amazing how when we give them an inch they take a mile. I think if this were in place the average family business would be safe from the greed of the government.

 

[Limomike]

Jo, You are absolutely right about that. The exemption needs to be raised instead of it falling back to the $1 million. At least keep it at the $3 million or raise it higher. Gotta get those congressmen to work for us to do it though.. :bang:
As far as a trust goes.. you would still have to pay the inheritance tax. Only way to "avoid" it is to have it in YOUR name before the death of your relatives.. Not sure about what a joint ownership would do though.

 

[Jogeephus]

It really needs to be higher than the $3 million. This was instigated as a form of social engineering as well as to pay off war debt. If you look at the demise of the middle class in this country I think most will agree its because of the death tax. If someone builds a business it is hard to pass this on to the children with the death tax looming over their heads. This forces the business owner to make financial decisions based on lowering the value of the business rather than building the business. This isn't good for the family nor is it good for those who work for the business.

LLC's, Trusts and all those things do little to shield you from the death tax. They do make attorneys wealthy and when an incompetent attorney constructs one it can leave the family in worst shape than they would have otherwise been because you can be painted in a corner. There is a very simple way to avoid the death tax completely and this doesn't require anything more than trust in your children, time and the acceptance to the fact that you will die. For obvious reasons, I won't put the details on the board but if anyone has a serious need to know the details I'll share with them in a pm but only to long time members of CT.