Saturday, March 14, 2009

Spending Millions to Save Billions

This is so obvious, I don't see how people fall for it. When I buy something and pay a sales tax, I am paying with money that I have paid taxes on. When that money is paid to the company's employees, they have to pay taxes. If money were only taxed once, anarchists would get their way, because there would be no taxes in a few years. So, no money for police, roads, education, food inspections, ...

The Campaign of the Super Wealthy to Kill the Estate Tax

[page 40] Myth: Estate Tax is Double Taxation

Advocates of estate tax repeal claim that the estate tax is unfair because it taxes the same money twice: once when it is earned as income and again as part of an estate. But this reflects a misunderstanding of the tax structure and of what is actually taxed in most estates.
Money in our society is frequently taxed upon transfer, so the same dollar is often taxed more
than once.

The reality is that the bulk of wealth in large taxable estates has never been taxed at all. This is wealth in the form of appreciated property, stocks, and bonds that have increased in value since they were acquired or inherited – and have never been taxed. Without an estate tax, billions of dollars of untaxed capital gains would pass within wealthy families without any tax.
In estates with assets over $10 million, over 56 percent of the wealth takes the form of
appreciated property, stocks and bonds. As estate tax wealth exemptions rise, the tax will
increasingly be levied on estates with higher percentages of appreciated property that has not
been taxed.

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