The US estate tax is a 40% tax rate assessed against estates transfers in excess of $5.4 million for individuals and $10.9 million for couples who pass on.
Let me put that another way — if you pass away , the tax kicks in only after your heirs receive the first $5.4MM (if it's you and your spouse who die at the same time, the heirs don't see any such tax until they've gotten $10.9MM). After that, the excess is taxed at 40%.
And this isn't even just a "1%" thing. A whopping 0.2% of American estates, about 5400 people (of the 3 million) who die this year will have estates that are affected. A repeal of the tax would net the heirs affected a whopping average of $3MM (which tells you something about the range of estates involved). The 318 largest estates would average a tax cut of $20 million.
Oh, and that whole canard about people being forced to sell the family farm? In 2013, a whopping 20 farm and small-business estates owed any estate tax — which can be paid off over 14 years.
And the net cost of repealing it, as the House GOP just voted to do? $269 billion over the next decade.
Fiscal conservatism and standing up for the little guy at its best. Thanks, GOP!
(Further data via http://goo.gl/GqjjZP and http://goo.gl/UUrCxb)
GOP passes massive tax break for millionaires, billionaires
With rising economic inequality, a $269 billion tax break, exclusively for multi-millionaires and billionaires, seems obscene.
Anyone with that kind of money knows to transfer funds into a trust long before they go.
+Jesse Butler Probably true for most cases, but clearly in some cases either the amounts are (relatively speaking) small enough that it wasn't worth doing or for some other reason it was impractical.
Sure, which is why that 0.2% actually get hit with it.
I don't understand how politicians can complain about the budget deficit and give whopping tax breaks that will increase the deficit. What kind of cognitive dissonance do they have going on?
+Scott Randel I think it's they assume that we have or can handle the cognitive dissonance. "Taxes BAD. No Taxes GOOD. You no like TAXES. We stop TAXES, so we GOOD."
Shame