Also, you know…Bilbo Fucking Baggins.
We also need to bring back primogeniture!
I wonder how much of the opposition to the estate tax is driven by the industry that’s been built up around scamming senile old rich people out of all their assets. There’s an enormous number of lawyers, doctors, and real estate developers who have made it their career.
Middle-Earthporn?
PR news: (There’s some follow up tweets to this that shows the hugely negative impact the Jones Act has on PR)
And donald the dotard expounds on why they didn’t:
But that’s not how it’s sold to the general public. I used to get an earful everyday about this by a coworker, who was genuinely terrified that when he died his (modest <250k) home would be split up and taxed to the point where his three children would be in debt because of it. GOPropaganda works.
Try playing this instead and it will definitely be vets:
The biggest problem with death / estate taxes is everyone wants to get their fingers in the pie.
You mention the federal tax, but states like my very own Oregon, have an additional 16% on top of that 35% and now you’re talking HALF the money. And Oregon only exempts the first $1M, and let me tell you $1M isn’t as much as you’d think if it needs to last 30 years.
This is insane.
You are punishing people for saving. You all want to lump this into “rich” and it’s the definition of rich I think that is problematic. If you aren’t saving at least $2M for retirement (which gives you $60-70K annually) then you’re going to have a limited retirement. Throw in a house that has increased in value to $600K or $1M and it’s not hard to get to $3M.
So people who scrimp / save for 30-40 years to save $2M, $3M or even $5M are rightfully pissed off about these taxes. In OR, of a $3M account, you’d lose $480K at 16%. That’s stupid.
Now if you want to talk ultra rich, I think you need to up the amount to something like $20M as a starting point. I would not classify $5M as “rich” if you’ve been saving for 30-40 years.
What are you talking about? These people are dead. Retirement??
Exactly. Fellow Oregonian here. 1 million bucks tax free is plenty to leave your kids after you’re gone. They can pay the state Estate Tax on amounts over that, IMHO. It’s not like Salem takes it all.
Also, wouldn’t the tax on a $3 million estate be 320k, seeing as how the first million is exempt?
It’d actually only be 205k total for 3M. The tax rate increases as the estate goes up.
What, you think Peter gives away fidget spinners for free at the Gates?
But seriously, @Tman, whatchoo talkin’ 'bout?
I think that @Tman is thinking of a case where the lifelong saver has the terrible luck of keeling over right after retirement. Still, this is money that essentially falls out of the sky to heirs-- they haven’t been doing the scrimping and saving (nor earned the money).
$1 million in savings? I should be so lucky.
I’m pretty certain that unless I win the lotto, there’s never going to be $1 million across my accounts.
Unless you and our spouse die unexpectly early, your retirement is your retirement. If you’re saving it to hand off to your kids, that’s not retirement. If you “scrimped” to have a lot more than you need in retirement, that’s inheritance you scrimped for not retirement.
Further, each individual can gift another 14K per year, tax free. If you have excessive retirement building up, you can hand over up to 28K per couple, to each kid, per year.
The situation where you end up with a pile of cash (5M+) that is inherented usually means you were pretty damn rich or planned very badly.
So do you think in some cases those heirs lives were influenced by the way their parents saved. Possibly helped, possibly not. I just find this feeling that anyone who benefits from their parents saving is just some kind of greedy hanger on who never loved their parents, only their money.
PS…Would someone be interested in starting a thread on the proposed tax cuts?
This is actually very true. Proper estate planning would probably make estate taxes moot.
well, it’s not just dying after retirement - you have to set yourself up to how old you think you’ll live. If you think you start with $2M and it whittles down, you need to talk w/ a retirement planner.
Essentially, it’s easier to think of this as an endowment that is doesn’t whittle down significantly until you’re in your 80’s or older - because you want to make sure you have enough, you need to plan on your maximum age - so you really need to curtail significant draw downs until you’re in your 80’s if you want it to last, say until 90 or 95.
People don’t plan on dying when they are 75.
BTW - yes, I didn’t exclude the first $1M in my OR example above. Even if it’s scaled and it would be $200K, that’s still way too much IMO. I don’t agree with this. You can feel free to disagree, but I guess I’ll side with the money should stay in the family.
As far as saving, you need to start young and be totally consistent - 10% a year from when you are 25 will compound significantly over time.
Also, if your kids have grandkids, that’s another 28K per gifting per year. Frankly, I think it makes more sense to help your kids out earlier than dropping 5M+ on them when they’re like 40-something.
I don’t think that a less than 10% effective rate on what passes to heirs is egregious in that $3 million Oregon example, myself, especially when the state has so many things it needs to spend money on, from education to infrastructure (water/sewer systems, roads, bridges, airports, public transit, election/voting system improvements, maybe municipal internet), and unlike the federal government, is in fact spending constrained as a practical reality (due to the fact it doesn’t issue its own currency).
And even then, you can avoid the estate taxes by putting it into trust, I think. It’s a lot more complex that we have been making it out to be in this thread.