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Nobody understands estate taxes, it's so frustrating. I have had conversations with coworkers who believe that the gov't will ruin you through estate taxes. Peo

• supertrope 5y ago
  The anti-estate tax lobby has masterfully branded it a death tax implying that it’s a tax when you die. There’s a huge tax waiver in the form of stepped up cost basis - capital gains tax is calculated using the share value when inherited not on grandpa’s purchase price.
  • votepaunchy 5y ago
    Note that the step-up in basis is something the Biden administration is looking to reduce to $1M/person.
• cletus 5y ago
  > - If you don't have literally $1M in assets you get taxed zero Oh it's much, much worse than that. The Trump tax "cuts" actually doubled the Federal estate tax thresholds to ~$11m for a singled person and ~$22m for married couples. > - If you live in the home it is exempted So I actually have a bit of a problem with this because generally real estate passes to beneficiaries of the estate on a stepped up basis. The idea is for children not to be saddled with a huge tax debt but there has to be limits to this. > ... amazing failure of describing how a thing works I see it from the somewhat opposite view and that is that conservatives in the US at least are so easily manipulated to the point where a seemingly large portion of them now believe democracy isn't working for them and you see this bubbling over at incidents like the attempted insurrection of Jan 6. It's downright ironic that the reddest states are actually the most Federally dependent and the democracy that supposedly isn't working for them is a system that gives such states political power far in excess of their population such that a political party can in many places hold power with ~40% of the vote.
  • oceanplexian 5y ago
    I don’t get how anything about this is worse. That $11m or $22m was already taxed and the person who earned it paid the government an unusually large sum of money for the privilege of being successful. Why should they get to double dip? The government taxes everything you earn, all the interest you earn on that money, all the property you buy, and all of the goods and services you buy. It then taxes the person selling those goods and services for the privilege of selling them. Any time a dollar hits the economy it’s probably been taxed 6 or 7 times. And for all this what do we get? Subpar infrastructure and bloated government programs that enrich bureaucrats.
    • Frondo 5y ago
      You know the phrase, "you can't take it with you"? Turns out that's literally true -- when you're dead, there is literally no use for possessions anymore. We all end up in the cold, cold ground with exactly the same amount of "stuff." The estate tax is a "government double dipping," it's a tax that's been around since the founding of the country, put there by the people who very specifically wanted to avoid generational wealth forming dynastic rulers over their newly-hatched nation. With an exemption on $11 mil, I wouldn't shed a tear if every cent beyond that were taxed at 100%.
    • xsmasher 5y ago
      If I get taxed on my income, and then give half of it to you, should it be exempt from taxes because it was "already taxed?" The whole idea is that money is taxed when it passed from one person to another.
      • cinquemb 5y ago
        Thankfully there are emerging alternatives to money that have been increasing in usage for about 13 years and offer more control to the individual as to how the resources under their domain are allocated exactly and transparently thru governance that are more accessible work arounds than the trusts, charitable writeoffs, etc.
  • tbihl 5y ago
• 1123581321 5y ago
  I think many people feel that if they don't constantly complain about the estate tax, the threshold will be lowered. They're not necessarily wrong.
  • marricks 5y ago
    If it did get lowered to affect normal people it'd only be from the efforts of rich people to poison the well against the taxes.
    • 1123581321 5y ago
      Interesting theory. I haven't read of any lobbying to that end (most seems to go into favorable windows and other means of exemption) but it would certainly create a larger block of opposition.
  • rtpg 5y ago
    In the US: >As of 2021, only estates valued at $11.70 million or more are subject to federal estate tax. No sympathy for people who think that sort of windfall from their parents should somehow be untouchable.
    • 1123581321 5y ago
      Yes, I think you may have misunderstood what I said. There are people worried about the threshold lowering, e.g., taxing estates of only a few hundred thousand, or perhaps anything (I'm not saying a lowering to this degree is remotely likely.) So they complain about the estate tax at its current levels. It's an example of the tug-of-war mentality that appears in much of American politics.
• anigbrowl 5y ago
  I don't think it's a failure to describe how it works so much as a long running publicity campaign dedicated to circulating inaccurate but emotive claims. There's a small army of people who get paid to write op-eds about small farmers being forced of their land by the cruel gubmint etc. etc., just there is about many other fake controversies, from tobacco to fossil fuels. You can explain how things work until you're blue in the face but it's not very effective if there's someone who's perfectly happy to lie, whether implicitly or (increasingly) explicitly. An awkward fact about propaganda and publicity campaigns is that the people who are articulating them don't necessarily need to believe in them, or even have others believe in them (though that helps). Professing the belief publicly can be an effective social signal for recognizing and cooperating with peers, as wella s identifying antagonists - think of the delight some political actors have in 'triggering' those with whom they disagree. One does not need to care about the issue oneself; political currency can be made out of simply upsetting other people, for both identification and entertainment purposes.
  • rtpg 5y ago
    Sorry, I totally agree that it's not about explaining stuff. I do acknowledge the massive PR campaign on this front making things confusing for people. I have my doubts about it being effective in itself. There feels like a baseline assumption (stuff like "well it's my stuff" or "taxes are annoying") that end up getting re-inforced through those campaigns. Maybe the real solution is nuking every op-ed page of the face of the planet.
  • anigbrowl 5y ago
    There's a small army of people who get paid to write op-eds about small farmers being forced of their land by the cruel gubmint etc. etc. Didn't mean to repeat myself bthere but it's only a matter of time before we see op-eds about small content farmers being forced off their domains by the estate tax. Might have to start a satirical Twitter account to fulminate about it.
• actually_a_dog 5y ago
  Not to mention all the fun and legal ways to work around them: trusts, gifts, life insurance, charitable donations, investing in the family business, etc.
• TheCoelacanth 5y ago
  > If you don't have literally $1M in assets you get taxed zero It's actually $11.7 million now.