Sunday, December 29, 2019

The Estate Tax Essay - 1270 Words

The Estate Tax Have you heard the phrase No taxation without representation? It was the common cry of the colonists before the revolutionary war. The colonists did not want to be taxed by England if they were not allowed to vote in the English elections. England’s refusal to allow them to vote was a major reason the colonists decided to create their own government. When this new government was first created it did not tax those people that were not allowed to vote. Then things changed; in 1916 the estate tax was created. (The estate tax is a levy that taxes deceased people’s estates if it is worth more than $675,00.) If one is to remain true to the American ideal of no taxation without representation, the estate tax should be†¦show more content†¦The reason for this is, much of the essential farm equipment used to compete in today’s cutthroat agriculture industry is extremely expensive. Many of the combines and tractors cost millions of dollars to purchase. When a farm er dies this leaves him wealthy but all of the wealth is tied up in land and farm equipment . The equipment plus the land automatically place a farmer well past the $675,000 estate tax-exemption limit. The heirs do not inherit enough liquidity to pay the tax which could be as high as 55% of the total estate. This forces many farmers to sell some or all of their land to bigger corporations in order to raise the necessary cash to pay the estate tax owed by the estate. This makes it difficult for the next generation to continue to farm. Especially with today’s commodities prices which require a farmer to own a lot of land to turn a profit. Those who support the estate tax based on the chance that some wealth has been garnered tax-free and the estate tax is a sure-fire way to make certain that all the wealth of the estate gets taxed at least once, may not have considered the fact that all of the remaining money is taxed more the once. Taxing money more than once is not the answer to a leaking tax code. It is also true the estate tax raises revenue. However, the estate tax and gift tax combined only brings in roughly 1% of the total Federal revenue. ( What is more is, the estate tax is the mostShow MoreRelatedThe Estate Tax Should Be Controlled3062 Words   |  13 Pagesright to have our accumulated wealth, also called Gross Estate, transfer over to our designated beneficiaries. However, before we die there are some considerations that must be made. The U.S. Internal Revenue Service has stated that the filing of an estate tax return is necessary for amounts over certain thresholds. These federal thresholds have exempted many Americans from having to worry about filing for estate tax. Yet, there are state estate taxes that can be particularly burdensome as Forbes magazineRead MoreEstate Tax Planning Proposal744 Words   |  3 PagesEstate Tax Planning Current law for estate tax, gift tax, and generation skipping transfer tax is a 35% rate with an exclusion of $5.12 million. This is scheduled to change on January 1, 2013 to a 55% tax rate with an exclusion of $1 million. Due to the scheduled change, it would be advisable to be very aggressive in tax maximization before December 31, 2012. Pending congressional action, there is a proposal to for a 45% tax rate with an exclusion of $3.5 million for estate and generationRead MoreA Lifetime Accessions Tax : An Alternative For The Estate Tax Essay2262 Words   |  10 PagesA Lifetime Accessions Tax: An alternative to the Estate Tax The estate tax is a tax upon your right to transfer property at the time of your death. It is often called the death tax and it has been a partisan point of disagreement for quite some time. As the tax only applies to estates of $5.45 million and over, this tax only applies to the wealthy. Enacted in 1916 to help finance World War I, the estate tax has come under more scrutiny lately because of our government’s financial situation and theRead MoreComparative Analysis Of The Estate Tax Essay2513 Words   |  11 Pages Comparative Analysis of the Estate Tax First and Last Name Class Number Teacher’s Name Date While the Presidential election of 2016 has been non-traditional in many ways, one issue that has retained its conventional place in American politics is the debate over the estate tax. According to Merriam-Webster Dictionary (2016) the estate tax, labeled the â€Å"death tax† by its opponents, is a tax that a person must pay on an estate (money or property) that he or she inherits. Given theRead MoreThe Federal Estate Tax Should Be Abolished1091 Words   |  5 Pagesmonths, the federal estate tax has been a popular topic in the news. Also known as the death tax, this tax is applied to the transfer of an estate at passing away of an individual. Generally, said estate includes all assets of the person who passed away, including financial assets like stocks, bonds, and mutual funds; real assets, like houses, land, or other tangible property; and proceeds from life insurance policies. The United States federal government established the estate tax that is currentlyRead MoreAvoi d Real Estate Investment Tax1407 Words   |  6 PagesMinimization of Individual Tax Liability in Real Estate Investment In the world of investing, in general, one question is often the most challenging to answer. How does an investor grow their nest egg without losing the majority of their gain to the IRS as income tax? This question is even more challenging in the area of real estate where one’s tax liability is drastically increased by just the sale of one property. This simple transaction can increasing the investor’s ordinary income if the propertyRead MoreDeductions from Gross Estate Under Philippines Tax Rules and Singapore Tax Rules1884 Words   |  8 PagesDEDUCTIONS FROM GROSS ESTATE UNDER PHILIPPINES TAX RULES AND SINGAPORE TAX RULES ADVENTIST UNIVERSITY OF PHILIPPINES PUTING KAHOY 2008 DEDUCTIONS FROM GROSS ESTATE PHILIPPINES TAX RULES Funeral Expenses For deaths occurring on or after January 1, 1998, the amount allowable as deduction shall be the lower amount between the actual funeral expenses (whether paid or unpaid) and five percent (5%) of the gross estate, but in no case to exceed two hundred thousand pesos (P200,000). Judicial ExpensesRead MoreEssay about ESTATE GIFT TAX P51868 Words   |  8 Pages (1) Grantor creates a trust with income to Spouse for life, remainder to Child if living and, if not, reversion to Grantor or Grantor’s estate. (a) If Grantor predeceases Spouse and Child, is Section 2037 applicable to the transfer? No. Section 2037 is not applicable to the transfer. Based on Section 2037, â€Å" The value of the gross estate shall include the value of all property to the extent of any interest therein of which the decedent has at any time after September7, 1916, made aRead MoreAcc 456 Short Answered Questions1248 Words   |  5 Pagesthe requirements for estimated tax payments by self-employed individuals? Individuals who work for themselves and make money to do so constitute as self-employment income. Independent contractors and sole proprietors are considered self-employed. They receive all payment without withholding any Social Security tax, Medicare tax, state tax, and etc. They do however have self-employment tax, which is taken out when the individual file Schedule C or C-EZ on their tax return. They would also need toRead MoreGeneration Skipping Tax1126 Words   |  4 PagesSkipping Transfer Tax INTRODUCTION AND ISSUE The United States generation skipping transfer tax imposes a tax on gifts and transfers to people more than one generation younger than the donor. An example is a grandparent giving a gift to a grandchild, in turn skipping their own child. Grandparents would give a gift to their grandchildren to avoid or defer federal gift taxes, but this is now subject to a generation skipping tax. Congress passed the original generation-skipping transfer tax in 1976 to go

No comments:

Post a Comment

Note: Only a member of this blog may post a comment.