Politics Death should not be a taxable event — it's time to end the estate tax
Biden's corporate tax plan takes aim at income inequality
WASHINGTON (AP) — From John Kennedy to Ronald Reagan to Donald Trump, American presidents have taken aim at corporate America's tax-avoidance schemes before — and mostly missed. Now, President Joe Biden is training the government’s sights again on the loopholes, shelters and international havens that have long allowed multinational companies to dodge taxes in ways that ordinary households cannot. The idea is twofold: First, to help pay for Biden's trillions in proposed spending — for everything from roads and bridges and green energy to internet access, job training, preschool and sick leave.
A few years ago, a Missouri farmer passed away. His family carefully planned for his death and had incorporated his grandson into the farm as his eventual successor. The family knew they would face a hefty tax bill, and even knew there would be an additional tax for skipping a generation on the inheritance. But their careful planning wasn't enough.
In the wake of the grandfather's death the family still had to take out hundreds of thousands of dollars in loans to pay the tax burden thrust upon them by the federal government, and it took them years to pay it off. The smart financial decision would have been to sell the farm, but for this family - like so many rural families that face the same agonizing decision - keeping the farm was not a financial decision at all. It was personal.
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As a 7th generation Missourian and family farmer from southern Missouri, I know firsthand that the last thing this hardworking American family needed was a hefty estate tax that nearly prevented their family's legacy from being carried on.
Unfortunately, this family isn't unique. For over 2 million family farms and ranches across the country and the tens of millions of small businesses, the threat of losing generations of their family's work is a very real possibility. Every day family-owned farms and small businesses are forced to take out loans or sell off land, equipment, property, or - in the worst-case scenario - the entire business operation to pay the federal estate tax and cover attorney fees.
In addition, the death tax forces family businesses to waste money on expensive insurance policies and estate planning. These burdensome compliance costs make it even harder for and deter business owners from expanding their businesses and creating more jobs.
Biden's capital gains tax hike to 39.6% will send rates soaring
President Joe Biden's proposed tax hike will cost high-earning Americans in more than a dozen states upwards of 50% on their long-term capital gains and other qualified dividends. Nearly doubling the federal capital gains rate could discourage those making more than $1 million from investing in the stock market as it’s increased from 23.8 per cent to 39.6 per cent, which would lower the GDP by 0.1 per cent and reduce federal revenue by around $124 billion over 10 years, according to the Tax Foundation.
In 2017, the Tax Cuts and Jobs Act (TCJA), which I proudly helped write, ushered in the strongest economy our nation has ever seen. It put money back into the pockets of hardworking Americans and gave Main Street businesses relief from the heavy-handed tax burdens of Big Government policies of the past.
Among these reforms was a doubling of the death tax threshold. Now, instead of spending money on life insurance and estate planning, more farmers are able to expand their businesses, upgrade buildings, and purchase needed equipment and livestock. But most importantly, in the tragic event that a family member passes away, families can continue operating their businesses without having to question how they are going to afford to write an expensive check to Uncle Sam.
Despite this much-needed relief, more needs to be done. That is why I have introduced, with the bipartisan support of over 140 of my colleagues, the Death Tax Repeal Act. This legislation would provide significant relief and peace of mind to family-owned farms, ranches, and businesses by fully repealing the estate and generation-skipping transfer taxes. Without the full repeal of the death tax, families with generational farms and small businesses will always live with uncertainty and in fear of the estate tax.
Democrats’ constituents would bear the brunt of Biden’s taxes
The late, great Jessica Walter once said in her “Arrested Development” role as matriarch of the fallen-from-grace Bluth family: “I’d rather be dead in California than alive in Arizona.” President Joe Biden’s tax proposals are about to put Lucille Bluth’s maxim to the test, as the White House pushes the biggest tax increases since President […] The post Democrats’ constituents would bear the brunt of Biden’s taxes appeared first on Roll Call.
Estate tax repeal is popular with voters as well. A 2017 NPR/Ipsos Poll found that, including 51 percent of self-identified Democrats polled.
The doubled tax exemption amount I fought for in TCJA expires at the end of 2025, increasing uncertainty and planning costs. It is high time for Congress to come together and provide certainty by fully repealing the death tax.
It is bad policy to require grieving families to pay an unreasonable tax on their loved one's nest egg. Far too often Americans have to sell family assets or take out egregious loans all to pay off this tax.
Death should not be a taxable event and no one should be punished for fulfilling the American dream.
Jason Smith represents Missouri's 8th District.
'Doesn't add a single penny': Fact-checking Biden's deficit claims .
In the past, Republicans have typically fought the Democrats over concerns spending proposals would expand the deficit and the continually growing national debt. Having weathered those critiques during the Obama years, President Joe Biden's proposals to revitalize the US economy seem designed to circumvent that line of attack, as he claims they won't increase the deficit.In the past, Republicans have typically fought the Democrats over concerns spending proposals would expand the deficit and the continually growing national debt.