5 ms·

How about the estate tax loophole? We've got better places to go looking.

ensignavenger 9y ago
It is my understanding that the tax proposal deals with that, too.
jdavis703 9y ago
Everyone thinks someone else's loopholes are better places to go looking. Even I succumb to this thinking, at first I was pretty pissed at the retirement saving plan elimination. But all us voters need to grow up and vote in people who have spines and will make us drink our spinach juice. It'd be really nice to have a tax code so simple it puts TurboTax and their ilk out of business.
- blackbagboys 9y ago
  Why do we - ordinary workers and students - have to drink the “spinach juice”? Why not the people who have amassed utterly unprecedented amounts of wealth and power?
  - conanbatt 9y ago
    Taxes are that fantastic thing that does good to everyone, specially when other people pay it.
  - pishpash 9y ago
    Because ordinary workers and students don't or aren't able to effectively exercise political power, ceding the polity to those who do so.
  - JonFish85 9y ago
    Because there is so much more money in the “ordinary workers and students” subset of society than there is in the top 0.x%.
    - sidlls 9y ago
      Not on an individual basis.
    - wahern 9y ago
      I can't tell if you're being sarcastic. FWIW, in 2011 the top 0.01% earned 5% of national income, the top 0.1% earned 10%, and the top 1% earned 20%. Source: http://ritholtz.com/2011/10/forget-the-top-1-look-at-the-top-0-1/ http://ritholtz.com/2011/10/forget-the-top-1-look-at-the-top... In 2016 the top 25% earned 51% of national income. Source: https://www.statista.com/statistics/203247/shares-of-household-income-of-quintiles-in-the-us/ https://www.statista.com/statistics/203247/shares-of-househo...
    - mattkrause 9y ago
      All those filthy rich grad students pulling in $20-35k/yr!
  - SamReidHughes 9y ago
    Ordinary workers aren't the main beneficiaries of retirement savings plans. It's the people that can afford $20K/yr to save that benefit.
  - jdavis703 9y ago
    You can eliminate all tax deductions, tax the wealthy, and cut middle class taxes at the same time. All of that requires that everyone in society drink some "spinach juice" though. Of course doing those three things are politically impossible in the current environment, but that's a different problem.
  - AnimalMuppet 9y ago
    Because, despite all the rhetoric to the contrary, raising other peoples' taxes isn't going to be enough. We're going to have to raise yours, too.
gnicholas 9y ago
Curious to know what you're referring to. The fact that it doesn't apply to all estates? That's also true of any tax that is progressive.
drawkbox 9y ago
Gifting when alive you are taxed at 15k+ or so. Gifting when dead you aren't taxed until 5m or 10m for married. The GOP tax plan doubles that to 10/20m and then removes it after 6 years. The estate tax was already a huge benefit when compared to the gift tax. What would be nice is if they could up the amount on the gift tax rate if they aren't going to collect any tax on gifting after death (inheritance). This could free up money that will only be in an estate and not used for years maybe even decades. When you compare the gift tax when alive to the gift tax after death (the estate tax) it is already a massive benefit.
- tssva 9y ago
  There is a lifetime $5.49 million exemption from the gift tax. Gifts above $14k are taxed. If you gave me $30k this year, you would not have to pay any taxes on it but your $5.49 million lifetime exemption would be reduced by $16k.
  - drawkbox 9y ago
    Wow never knew that. I always thought the person receiving the gift had to pay taxes on any amount above the gift tax rate per year if the tax wasn't paid by the giver i.e. 14k currently. Basically then any money you receive or earn is taxable except loans and gifts up to the gift tax limit, all other money movement is taxed. Of course winnings are still taxed at normal rates because that is income not gifted per se, I guess I was conflating the two. Example: If you win a car you owe taxes on the whole thing. So essentially it is the same limit as the estate tax, so I wonder if that also doubles and also goes away in the tax bill.
nostromo 9y ago
That will never happen because nearly all of our elected officials use trusts to minimize or eliminate entirely the estate tax they would otherwise pay. The Clintons, Kennedys, Romnys, Bushs, etc... http://time.com/money/4344981/hillary-clinton-estate-plan-taxes/ http://time.com/money/4344981/hillary-clinton-estate-plan-ta... https://www.forbes.com/sites/carlodonnell/2014/07/08/how-the-1-billion-kennedy-family-fortune-defies-death-and-taxes-3/ https://www.forbes.com/sites/carlodonnell/2014/07/08/how-the... http://www.wealthmanagement.com/wealth-planning/unlocking-mitt-romney-s-family-trust http://www.wealthmanagement.com/wealth-planning/unlocking-mi... Heck, even Noam Chomspky has used estate planning to avoid paying the estate tax. https://www.hoover.org/research/noam-chomsky-closet-capitalist https://www.hoover.org/research/noam-chomsky-closet-capitali...

It is my understanding that the tax proposal deals with that, too.

Everyone thinks someone else's loopholes are better places to go looking. Even I succumb to this thinking, at first I was pretty pissed at the retirement saving plan elimination. But all us voters need to grow up and vote in people who have spines and will make us drink our spinach juice. It'd be really nice to have a tax code so simple it puts TurboTax and their ilk out of business.

blackbagboys 9y ago
Why do we - ordinary workers and students - have to drink the “spinach juice”? Why not the people who have amassed utterly unprecedented amounts of wealth and power?
- conanbatt 9y ago
  Taxes are that fantastic thing that does good to everyone, specially when other people pay it.
- pishpash 9y ago
  Because ordinary workers and students don't or aren't able to effectively exercise political power, ceding the polity to those who do so.
- JonFish85 9y ago
  Because there is so much more money in the “ordinary workers and students” subset of society than there is in the top 0.x%.
  - sidlls 9y ago
    Not on an individual basis.
  - wahern 9y ago
    I can't tell if you're being sarcastic. FWIW, in 2011 the top 0.01% earned 5% of national income, the top 0.1% earned 10%, and the top 1% earned 20%. Source: http://ritholtz.com/2011/10/forget-the-top-1-look-at-the-top-0-1/ http://ritholtz.com/2011/10/forget-the-top-1-look-at-the-top... In 2016 the top 25% earned 51% of national income. Source: https://www.statista.com/statistics/203247/shares-of-household-income-of-quintiles-in-the-us/ https://www.statista.com/statistics/203247/shares-of-househo...
  - mattkrause 9y ago
    All those filthy rich grad students pulling in $20-35k/yr!
- SamReidHughes 9y ago
  Ordinary workers aren't the main beneficiaries of retirement savings plans. It's the people that can afford $20K/yr to save that benefit.
- jdavis703 9y ago
  You can eliminate all tax deductions, tax the wealthy, and cut middle class taxes at the same time. All of that requires that everyone in society drink some "spinach juice" though. Of course doing those three things are politically impossible in the current environment, but that's a different problem.
- AnimalMuppet 9y ago
  Because, despite all the rhetoric to the contrary, raising other peoples' taxes isn't going to be enough. We're going to have to raise yours, too.

gnicholas 9y ago

Curious to know what you're referring to. The fact that it doesn't apply to all estates? That's also true of any tax that is progressive.

drawkbox 9y ago

Gifting when alive you are taxed at 15k+ or so. Gifting when dead you aren't taxed until 5m or 10m for married. The GOP tax plan doubles that to 10/20m and then removes it after 6 years. The estate tax was already a huge benefit when compared to the gift tax. What would be nice is if they could up the amount on the gift tax rate if they aren't going to collect any tax on gifting after death (inheritance). This could free up money that will only be in an estate and not used for years maybe even decades. When you compare the gift tax when alive to the gift tax after death (the estate tax) it is already a massive benefit.

tssva 9y ago
There is a lifetime $5.49 million exemption from the gift tax. Gifts above $14k are taxed. If you gave me $30k this year, you would not have to pay any taxes on it but your $5.49 million lifetime exemption would be reduced by $16k.
- drawkbox 9y ago
  Wow never knew that. I always thought the person receiving the gift had to pay taxes on any amount above the gift tax rate per year if the tax wasn't paid by the giver i.e. 14k currently. Basically then any money you receive or earn is taxable except loans and gifts up to the gift tax limit, all other money movement is taxed. Of course winnings are still taxed at normal rates because that is income not gifted per se, I guess I was conflating the two. Example: If you win a car you owe taxes on the whole thing. So essentially it is the same limit as the estate tax, so I wonder if that also doubles and also goes away in the tax bill.

nostromo 9y ago

That will never happen because nearly all of our elected officials use trusts to minimize or eliminate entirely the estate tax they would otherwise pay. The Clintons, Kennedys, Romnys, Bushs, etc... http://time.com/money/4344981/hillary-clinton-estate-plan-taxes/ http://time.com/money/4344981/hillary-clinton-estate-plan-ta... https://www.forbes.com/sites/carlodonnell/2014/07/08/how-the-1-billion-kennedy-family-fortune-defies-death-and-taxes-3/ https://www.forbes.com/sites/carlodonnell/2014/07/08/how-the... http://www.wealthmanagement.com/wealth-planning/unlocking-mitt-romney-s-family-trust http://www.wealthmanagement.com/wealth-planning/unlocking-mi... Heck, even Noam Chomspky has used estate planning to avoid paying the estate tax. https://www.hoover.org/research/noam-chomsky-closet-capitalist https://www.hoover.org/research/noam-chomsky-closet-capitali...