Inheritance Tax vs Income Tax

[gwballin]

Why is it bad policy? Why should someone who earns money have to pay a tax, while someone who did not earn money not have to pay a tax. That is punishing someone for working.

Sounds like an argument for abolishing the income tax - we may be on the same page after all.

Or alternatively, I'll just tell my employer not to pay me a salary but just give me a gift for hanging out at his business, and then I won't have to pay tax either.

Its been tried, doesn't really work since the IRS does know what the term gift means.

That's a good point, and the reason why we have exemptions for some reasonable amount.

And you are to determine what is reasonable?

Because if Paris Hilton pays no tax, someone else has to pay more.

That is just not how it works in the real world.

That would be a nice argument if it were true. But that "don't tax the rich because they invest it" argument isn't applicable to a estate tax setting.

Are you familiar with why the estate tax was first developed? It was not because the government wanted to raise additional revenue (it was a side effect), but because a handful of families (think Rockefellers, etc.) owned more than 80% (don't quote me on that it has been a long time since I did the research, suffice it to say it was an unusually large number) and the government was fearful that if they did not step in and take part of the assets as they passed from generation to generation (that right the same assets being taxes every generation and twice if the generation-skipping tax applied) so they would not get too powerful, not that is a punishment.

Put another way, the estate tax is not about raising revenues, it is about socialist social engineering.

 

[gwballin]

Of course it does. You are paying less income tax than if they had raised the income tax as opposed to the property tax.

You are looking at it absolutely. You have to look at it relatively.

Sure, the govt could eliminate the estate tax, and borrow the $40 billion every year without raising the income or FICA tax to make up the difference. Aside from the fact that you have simply replaced a balance budget with a deficit budget to make up the lack of revenues, relatively speaking, those paying income tax are making up the difference, because it could have been their taxes reduced instead of the estate tax, and the budget would be in the same situtation.

Again, not all tax legislation is revenue neutral. If one goes up another does not necessarily come down.

 

[Iriemon]

Again, not all tax legislation is revenue neutral. If one goes up another does not necessarily come down.

Again, relatively, it does. If heirs are not paying taxes, it means that other tax payors are relatively paying more.

 

[Voidwar]

Addressed above. If someone pays me for my services with money that the person had already paid those taxes, why should I have to pay a tax?

The difference between a gift/ inheritance/ family business / birthright, and your income is pretty obvious. You traded those services for that income, and are taxed on that income if you sold those services in the U.S. An income tax is decidedly different from a wealth tax / inheritance tax.

 

[Voidwar]

Sure it does, for the same reason a progressive tax makes sense.

Too bad that it doesn't, and cannot be defended as anything but stealing from the wealthy. Rigamarole all the new age lingo you like, progressive taxation is just voting to hose the wealthy just because they have it. It is merely classism, using its ugly clout at the ballot box, to swipe from those who generate more income than joe average.

 

[Voidwar]

What did Paris do to build the Hilton fortune?

Its not your fortune, so it is absolutely none of your envious little business. How do you know that she isn't a sweet and loving daughter to her father in their off camera relationship ? How do you know how many kindnesses she may have done for other membres of her family ? Your questions themselves are exhibitive of shallow, greedy, bad taste. Going after Paris on her own level ?

 

[Voidwar]

No more penalizing than taking the salary of some shmoe who worked for it.

You keep trying to repeat this inaccurate characterization, and it is NOT gonna fly. The real parallel here would be the Taxman wanting Joe Shmoe's Kid's Christmas Present Money. A gift to one's children, that is the real parallel and Joe Shmoe wouldn't do it to his neighbor, so why do lefties, when arguing in support of inheritance taxes, try to convince Joe Schmoe that this shitty thing is ok to do to the weathy guy across town ? When he has just died ???? Lefty classist envy makes me want to puke.

 

[rathi]

Too bad that it doesn't, and cannot be defended as anything but stealing from the wealthy. Rigamarole all the new age lingo you like, progressive taxation is just voting to hose the wealthy just because they have it. It is merely classism, using its ugly clout at the ballot box, to swipe from those who generate more income than joe average.

I'd rather rich people who won't really miss the money pay more taxes than the poor who have greater need for it.

Its not your fortune, so it is absolutely none of your envious little business. How do you know that she isn't a sweet and loving daughter to her father in their off camera relationship ? How do you know how many kindnesses she may have done for other membres of her family ? Your questions themselves are exhibitive of shallow, greedy, bad taste. Going after Paris on her own level ?

Paris might be the most darling child in the world, but that doesn't change the fact she didn't work for the damn money. The income tax payer did.

You keep trying to repeat this inaccurate characterization, and it is NOT gonna fly. The real parallel here would be the Taxman wanting Joe Shmoe's Kid's Christmas Present Money. A gift to one's children, that is the real parallel and Joe Shmoe wouldn't do it to his neighbor, so why do lefties, when arguing in support of inheritance taxes, try to convince Joe Schmoe that this shitty thing is ok to do to the weathy guy across town ? When he has just died ???? Lefty classist envy makes me want to puke.

The problem with your ideal model, is the poor peons get pissed off and use violence to steal wealth. Then you get a communist revolution on your hands and everything goes to hell. Not everyone is willing to sacrifice their lives at the altar of property rights. I like the private-property capitalist system just as much as the next guy, but I don't think its the most important thing in life.

 

[Voidwar]

I'd rather rich people who won't really miss the money

This is quite simply stupid. You don't know them, so your opinion on whther they will miss it is worth less than nothing, and My guess, that they will miss the money, because they value the money, since they went and traded their working life for it, is much more likely.

Paris might be the most darling child in the world, but that doesn't change the fact she didn't work for the damn money. The income tax payer did.

Joe Schmoe's kids didn't work for their Christmas presents either, so you don't have a point, just class envy.

The problem with your ideal model, is the poor peons get pissed off and use violence to steal wealth.

LOL A great line from "Gangs of New York" might help you with that naivete . . .

Half of the poor, can always be hired to kill the other half.

 

[Iriemon]

Its not your fortune, so it is absolutely none of your envious little business.

1) If I have to pay higher taxes so that trust fund babies and Parises you defend don't have to pay any, it is definitely my business.

2) You are the one who claimed that the heirs worked to build the fortune as the reason they should pay taxes. If you don't want to try to defend that silly statement, it is understandable.

How do you know that she isn't a sweet and loving daughter to her father in their off camera relationship ? How do you know how many kindnesses she may have done for other membres of her family ? Your questions themselves are exhibitive of shallow, greedy, bad taste. Going after Paris on her own level ?

Good for her. So what. Is it your proposition is we should give special tax favoritism treatment to sweet and loving and kind people, as opposed to people who work for their money?

 

[Iriemon]

You keep trying to repeat this inaccurate characterization, and it is NOT gonna fly. The real parallel here would be the Taxman wanting Joe Shmoe's Kid's Christmas Present Money. A gift to one's children, that is the real parallel and Joe Shmoe wouldn't do it to his neighbor, so why do lefties, when arguing in support of inheritance taxes, try to convince Joe Schmoe that this shitty thing is ok to do to the weathy guy across town ? When he has just died ???? Lefty classist envy makes me want to puke.

It is absolutely accurate. You sit there and pretend the Govt can eliminate taxes on the richest and it doesn't make a difference is just bullshit. If the rich don't pay taxes, the not rich pay more. Which is exactly what you Leona Helmsley "only the little people pay taxes" types have been fighting for, and partially achieving over the past 6 years. Your greed make me puke. The wealth is never enough, and so you'll squeeze folks out there struggling to just get by because it's always about how much more you can get. Class warfare by folks like against the working folks makes me want to puke more.

 

[Iriemon]

This is quite simply stupid. You don't know them, so your opinion on whther they will miss it is worth less than nothing, and My guess, that they will miss the money, because they value the money, since they went and traded their working life for it, is much more likely.

Of course they'll miss the money. It's never enough.

And can you image the shame at the yacht club with they have to pull up in that measely 110' yacht instead of a 150'er?

Lefties just don't understand and have no compassion.

 

[Iriemon]

Do you really think the process happens overnight? Tax revenues are at record levels now at tax rates that are historically very low, it is a matter of opening your eyes.

Tax revenues are not at record levels by any measure other than absolute value, which is meaningless as a comparison.

 

[Iriemon]

Sounds like an argument for abolishing the income tax - we may be on the same page after all.

Fine. Until they do, income from inheritance should be taxed at the same rate as other sources of income.

Its been tried, doesn't really work since the IRS does know what the term gift means.

Trying paying your employees "gifts" instead of salaries and test that theory.

And you are to determine what is reasonable?

For my opinion I am.

That is just not how it works in the real world.

No that is exactly how it works. Your contention that we could eliminate the taxes the rich pay and it won't make a difference on whether others pay more is hogwash. Even if you are a pass the bucker and think the Govt should just borrow a bunch of money.

Are you familiar with why the estate tax was first developed? It was not because the government wanted to raise additional revenue (it was a side effect), but because a handful of families (think Rockefellers, etc.) owned more than 80% (don't quote me on that it has been a long time since I did the research, suffice it to say it was an unusually large number) and the government was fearful that if they did not step in and take part of the assets as they passed from generation to generation (that right the same assets being taxes every generation and twice if the generation-skipping tax applied) so they would not get too powerful, not that is a punishment.

Good reason. There is no reason why the working folks should be taxed more heavily while the Paris Hiltons inherits hundreds of millions and pay none.

Put another way, the estate tax is not about raising revenues, it is about socialist social engineering.

All taxes have that element. But the estate taxes, even with huge exemptions do raises tens of billions in tax revenue.

 

[Iriemon]

Originally Posted by Iriemon
Addressed above. If someone pays me for my services with money that the person had already paid those taxes, why should I have to pay a tax?

The difference between a gift/ inheritance/ family business / birthright, and your income is pretty obvious. You traded those services for that income, and are taxed on that income if you sold those services in the U.S. An income tax is decidedly different from a wealth tax / inheritance tax.

Sure it is. Monies received based on work is monies received for effort and providing a valuable service of some sort.

Monies received as a gift/inheritance is monies received for the special talent and skill of being born to the right womb.

Unless you are a proponent of fuedalism as opposed to a meritocracy (and granted, many are, including many here apparently) it doesn't make sense to have a tax system that punishes work and effort more while favoring those who just happened to pick the right family to be born into with special tax free exemptions.

 

[Iriemon]

Originally Posted by Iriemon
Sure it does, for the same reason a progressive tax makes sense.

Too bad that it doesn't, and cannot be defended as anything but stealing from the wealthy. Rigamarole all the new age lingo you like, progressive taxation is just voting to hose the wealthy just because they have it. It is merely classism, using its ugly clout at the ballot box, to swipe from those who generate more income than joe average.

Taxes are not stealing, they are a lawful fee for being a part of society.

A progressive tax makes perfect sense, recognizing that a tax which takes away monies needed for necessities imposes a far harsher burden and punishment than a tax that reduces monies available for luxuries.

Eliminating taxes on the richest while imposing a tax on the poorer means that the poorer have less money for basic necessities so that the richest can buy a G5 instead of a G3. Yet it is a crushing burden on the poorer.

Not that you Leona Helmsley "only the little people pay taxes" fuedalists would give a damn about that.

 

[Iriemon]

The problem with your ideal model, is the poor peons get pissed off and use violence to steal wealth. Then you get a communist revolution on your hands and everything goes to hell. Not everyone is willing to sacrifice their lives at the altar of property rights. I like the private-property capitalist system just as much as the next guy, but I don't think its the most important thing in life.

That is the blindness of greed. They do not see that in the long run, by spreading a little wealth around they wealthier end up better off in the long run. Ask the folks in Cuba or Venezuela.

 

[rivrrat]

That is the blindness of greed. They do not see that in the long run, by spreading a little wealth around they wealthier end up better off in the long run. Ask the folks in Cuba or Venezuela.

LMAO

So because some people will steal, we should just give them money to stop them from stealing? I do hope you're kidding.


As far as the OP goes.. I'm very much against an inheritance tax. (But then again, I'm against most taxes) That money has already been taxed, it shouldn't be taxed yet again. And to the people who say that the "rich kids" get something for nothing... it's BS. The person who leaves their savings to their children worked for that money. They worked so that they COULD leave something to their children, who the hell is anyone else to determine whether or not the kids "deserve" it?

Good god, self-righteous nannies piss me off.

 

[Iriemon]

LMAO

So because some people will steal, we should just give them money to stop them from stealing? I do hope you're kidding.

No, I don't think we should give money to people who steal; nor did I ever say that.

As far as the OP goes.. I'm very much against an inheritance tax. (But then again, I'm against most taxes) That money has already been taxed, it shouldn't be taxed yet again.

All money has been taxed and is taxed over again everytime there is a transfer of it from one person to another. People who are paid for their services are paid with money that has already been taxed too.

Plus, most estates values have in fact not been taxed.

And to the people who say that the "rich kids" get something for nothing... it's BS. The person who leaves their savings to their children worked for that money. They worked so that they COULD leave something to their children, who the hell is anyone else to determine whether or not the kids "deserve" it?

If the kids did not work for it, they what are they getting something for, other than being a family member.

Good god, self-righteous nannies piss me off.

Greedy fuedalists piss me off more.

 

[rivrrat]

If the kids did not work for it, they what are they getting something for, other than being a family member.

That's what families DO. That's what they SHOULD do... take care of their own so their kids don't have to go whining to the government to help them. We feed, clothe, and house our children. Is there something wrong with that?

How can you possibly think that there's something wrong with a person working hard for money and then giving that money to their family to help take care of them?

Greedy fuedalists piss me off more.

Greedy? ROFL I'm not the one demanding money from someone else to pay for myself. If desiring to take care of myself and my family instead of mooching off others is "greedy", then yeah I guess I am. I'm a horrible, greedy, selfish person for thinking that I - and everyone - should be responsible for themselves and their families.

 

[Iriemon]

That's what families DO. That's what they SHOULD do... take care of their own so their kids don't have to go whining to the government to help them. We feed, clothe, and house our children. Is there something wrong with that?

Nothing at all. I plan to leave my daughters a hefty estate. I didn't say that inheritance should be forbidden, just that it should be taxed like other transfers of assets.

Greedy? ROFL I'm not the one demanding money from someone else to pay for myself.

Of course you are. If the wealthy don't pay a tax on transfers of assets, folks who receive transfers of assets for work have to pay relatively more taxes.

If desiring to take care of myself and my family instead of mooching off others is "greedy", then yeah I guess I am. I'm a horrible, greedy, selfish person for thinking that I - and everyone - should be responsible for themselves and their families.

No, you'd be horrible, greedy, and selfish for thinking that you should not have to pay any tax on hundreds of millions of dollars you receive from an inheritance you did not earn while working folks have to pay more taxes to make up the difference.

 

[rivrrat]

Of course you are. If the wealthy don't pay a tax on transfers of assets, folks who receive transfers of assets for work have to pay relatively more taxes.

How so?

No, you'd be horrible, greedy, and selfish for thinking that you should not have to pay any tax on hundreds of millions of dollars you receive from an inheritance you did not earn while working folks have to pay more taxes to make up the difference.

Whoever left it to me earned it - thus, the money has already been taxed. The "working folk" who earned that inheritance paid their taxes on it like everyone else. And who the hell says it has to be "millions of dollars"? And, who says I'm not working even if I did get some inheritance? And how does it make anyone elses taxes go up? It doesn't. If someone gives me $1000, my neighbor doesn't have to pay more taxes because I got $1000.

 

[Iriemon]

How so?

Because if one source of tax is eliminated, that means either (1) another source has to be increased to make up for it, or (2) the another source cannot be lowered because the estate tax is eliminated. In either case, the other sources are paying more.

Whoever left it to me earned it - thus, the money has already been taxed.

This is sounding like a broken record. So what. Whoever pays me earned it thus the money has already been taxed. All money has already been taxed. So why should money that has been taxed and is transferred to someone who earned it be taxed again while money that is transferred to someone who did not earn not be taxed again?

The "working folk" who earned that inheritance paid their taxes on it like everyone else.

No, if the estate taxes are eliminated, folks who inherit did not pay taxes on it, very much unlike someone who is paid a salary.

And who the hell says it has to be "millions of dollars"?

Are you denying there are not estates worth hundreds of millions of dollars?

Or are you distiguishing particularly large estates worth hundreds of millions of dollars, and agreeing that they should be subject to a tax?

And, who says I'm not working even if I did get some inheritance?

If you earn it, it was transferred to you, and you have paid taxes on it, I agree you shouldn't have to pay taxes a second time.

And how does it make anyone elses taxes go up? It doesn't. If someone gives me $1000, my neighbor doesn't have to pay more taxes because I got $1000.

Effectively, if you don't have to pay taxes on that $1000, and she has to pay more taxes on what she earned, she is. She either has to pay more taxes to make up for the tax you did not pay, or she will not get a tax decrease because you did.

Let's put it another way. The Govt eliminates the estate tax and loses $40 billion in tax revenue. One of three things must happen. 1) The Govt raises other sources of revenue (primarily income tax), or 2) the Govt borrows the difference, or 3) cuts spending to offset the loss of revenue. What has been happening with the Republicans is #2 -- the Govt has simply borrowed more money -- over $3 trillion more in the last 6 years.

However, even if you are a pro-debt Republican (and there are hordes of them these days) and think the Govt borrowing money to pay for tax cuts is a keen thing, in effect you still have those who are paying income taxes in effect paying more in tax for the elimination of the estate tax. Why? Because instead of eliminating the estate tax and borrowing, the Govt could have instead cut the income tax an equivalent amount and borrowed.

No matter how you slice it, working folk will pay more tax so that the Parises pay none on their inheritance.

 

[AcePylut]

Because if one source of tax is eliminated, that means either (1) another source has to be increased to make up for it, or (2) the another source cannot be lowered because the estate tax is eliminated. In either case, the other sources are paying more.

Or...

3) Programs which rely on stealing money from the wealthy to give to the poor should be eliminated.

On inheritance:

The right to dispose of one's income belongs to the producer, and if he wishes to give it to an heir, a charity, or to flush it down the toilet -- that is the producer's right. It is not any of your concern, and it certainly is not the concern of the government.

What this means? It's not "your" right to decide how that person can dispose his income... it's "his" right. The more "you" try to force him to spend his money as you (not him) see fit, the more "your" position becomes on of justifying theft.

That's all this is. "He" wants to give his already income taxed income to someone else... and you want to take that away from him.

Arguing that because "double taxation" exists, it's ok to double tax, is a fallacy. Weather or not "Double taxation" exists isn't the issue. To support double taxation because it already "exists" is perpetrating more wrong doing.

To support "new" types of unequal laws, economic discrimination, because they already exist, does not make the "new" laws "equal" or "non-discriminatory".

"You" do not have the right to tell "them" what "they" can do with their money, and by arguing that "they" should have to pay inheritance "tax" so you don't have to pay "your" taxes, while arguing that "they" should pay more taxes so "you" don't have to pay more taxes... is exactly that.

Argue for fairness... every dollar of income (of which inheritance and property taxes aren't "income") is taxed the same, one time only.

Anything else is merely "this block" of people imposing their moral outlook upon another block of people. That goes against everything this country stands for.

 

[AcePylut]

No matter how you slice it, working folk will pay more tax so that the Parises pay none on their inheritance.

Which is completely irrelevant... because the "working folk" should be paying their fair share of taxes. That they've been getting an "unfair in their favor" and/or free ride today doesn't not make this unfair in their favor taxation right. It's wrong, no matter how you slice it.