Most Popular
1. Banking Crisis is Stocks Bull Market Buying Opportunity - Nadeem_Walayat
2.The Crypto Signal for the Precious Metals Market - P_Radomski_CFA
3. One Possible Outcome to a New World Order - Raymond_Matison
4.Nvidia Blow Off Top - Flying High like the Phoenix too Close to the Sun - Nadeem_Walayat
5. Apple AAPL Stock Trend and Earnings Analysis - Nadeem_Walayat
6.AI, Stocks, and Gold Stocks – Connected After All - P_Radomski_CFA
7.Stock Market CHEAT SHEET - - Nadeem_Walayat
8.US Debt Ceiling Crisis Smoke and Mirrors Circus - Nadeem_Walayat
9.Silver Price May Explode - Avi_Gilburt
10.More US Banks Could Collapse -- A Lot More- EWI
Last 7 days
Stock Market Volatility (VIX) - 25th Mar 24
Stock Market Investor Sentiment - 25th Mar 24
The Federal Reserve Didn't Do Anything But It Had Plenty to Say - 25th Mar 24
Stock Market Breadth - 24th Mar 24
Stock Market Margin Debt Indicator - 24th Mar 24
It’s Easy to Scream Stocks Bubble! - 24th Mar 24
Stocks: What to Make of All This Insider Selling- 24th Mar 24
Money Supply Continues To Fall, Economy Worsens – Investors Don’t Care - 24th Mar 24
Get an Edge in the Crypto Market with Order Flow - 24th Mar 24
US Presidential Election Cycle and Recessions - 18th Mar 24
US Recession Already Happened in 2022! - 18th Mar 24
AI can now remember everything you say - 18th Mar 24
Bitcoin Crypto Mania 2024 - MicroStrategy MSTR Blow off Top! - 14th Mar 24
Bitcoin Gravy Train Trend Forecast 2024 - 11th Mar 24
Gold and the Long-Term Inflation Cycle - 11th Mar 24
Fed’s Next Intertest Rate Move might not align with popular consensus - 11th Mar 24
Two Reasons The Fed Manipulates Interest Rates - 11th Mar 24
US Dollar Trend 2024 - 9th Mar 2024
The Bond Trade and Interest Rates - 9th Mar 2024
Investors Don’t Believe the Gold Rally, Still Prefer General Stocks - 9th Mar 2024
Paper Gold Vs. Real Gold: It's Important to Know the Difference - 9th Mar 2024
Stocks: What This "Record Extreme" Indicator May Be Signaling - 9th Mar 2024
My 3 Favorite Trade Setups - Elliott Wave Course - 9th Mar 2024
Bitcoin Crypto Bubble Mania! - 4th Mar 2024
US Interest Rates - When WIll the Fed Pivot - 1st Mar 2024
S&P Stock Market Real Earnings Yield - 29th Feb 2024
US Unemployment is a Fake Statistic - 29th Feb 2024
U.S. financial market’s “Weimar phase” impact to your fiat and digital assets - 29th Feb 2024
What a Breakdown in Silver Mining Stocks! What an Opportunity! - 29th Feb 2024
Why AI will Soon become SA - Synthetic Intelligence - The Machine Learning Megatrend - 29th Feb 2024
Keep Calm and Carry on Buying Quantum AI Tech Stocks - 19th Feb 24

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

The $15 Million Death Tax Incentive

Politics / Taxes Jul 14, 2010 - 09:28 AM GMT

By: DailyWealth

Politics

Best Financial Markets Analysis ArticleDr. Steve Sjuggerud writes: "You don't know whether to commit suicide or just go on living and working," Eugene Sukup told the Wall Street Journal over the weekend.

Sukup is an 81-year-old maker of grain bins in Sheffield, Iowa. If he dies this year, his death tax will be zero. If he dies after December 31 this year, his death tax could be more than $15 million.


It's not just Sukup... Tens of thousands will be affected. By December of this year (if Congress does nothing), Jack Kevorkian might find himself with a line of patients out the door – people in Sukup's situation avoiding the coming tax bomb. It's the "largest increase in a major tax that we've ever seen," says tax historian Joseph Thorndike.

Here's the situation...

The estate tax is set to rise from 0% this year to 55% next year. While many people think the "death tax" is only for the ultra-rich, they've got it wrong... The death tax will kick in at a 55% rate starting on estates with just $1 million.

Look, a million-dollar estate ain't what it used to be... You surely aren't ultra-rich. If you're earning 3% interest on a million-dollar estate, that's $30,000 a year to live on. That's hardly enough to cover health insurance and the simple cost of living.

On the floor of the Senate a month ago, Iowa Senator Chuck Grassley talked about the upcoming death tax situation and two families (including the Sukups) from his home state...

These two family-owned companies will be facing a very large combined estate tax bill. That bill could total tens of millions of dollars between the two companies. That is tens of millions of dollars that will leave the state of Iowa.

These companies might face a fire sale and so often in this circumstance a company is sold to someone with no interest or desire to maintain the current location or contributions to the community.

After describing the jobs that would be destroyed by a big tax on these estates, Grassley continued...

What amazes me is the zeal by some to use tax policy to inflict this kind of damage on family farms and small businesses. All of this to fund an ever-expanding set of federal benefits to many who don't pay any income tax. The signal sent is that those who work hard, save, and want to pass something onto their families exist solely to fund these bloated federal programs.

Why work hard? Why save? Why not work less? Why not go into debt or live beyond your means? In the end, the government levels everyone out, at death, by, as the President said, "spreading the wealth around."

Grassley summed it up, "Taxing people's assets upon their death is just plain wrong..."

I agree with Senator Grassley. These days, entrepreneurs like Eugene Sukup give nearly half of their income to the government in the form of income taxes, property taxes, and sales tax. To then be forced in death to give half of what's left – that is... extraordinary.

In very rough terms, the government is expropriating three-quarters of your money. Where are we, North Korea?

The death tax rate should not be 55%. It should not kick in as low as $1 million. And no tax should be so bizarrely punitive that there's a $15 million "death incentive" for Americans like Eugene Sukup.

You may have a different opinion than I do. If you think it's right for a 55% death tax to kick in on estates starting at $1 million, then do nothing – that's the current law for 2011.

But if you think it is ridiculous, you'd better do something.

Senator Grassley said fixing the death tax that starts in 2011 is "nowhere on the Senate's radar screen." So contact your congressman, contact your senator, and let them know something has to be done.

Regards,

Steve

http://www.dailywealth.com

The DailyWealth Investment Philosophy: In a nutshell, my investment philosophy is this: Buy things of extraordinary value at a time when nobody else wants them. Then sell when people are willing to pay any price. You see, at DailyWealth, we believe most investors take way too much risk. Our mission is to show you how to avoid risky investments, and how to avoid what the average investor is doing. I believe that you can make a lot of money – and do it safely – by simply doing the opposite of what is most popular.

Customer Service: 1-888-261-2693 – Copyright 2010 Stansberry & Associates Investment Research. All Rights Reserved. Protected by copyright laws of the United States and international treaties. This e-letter may only be used pursuant to the subscription agreement and any reproduction, copying, or redistribution (electronic or otherwise, including on the world wide web), in whole or in part, is strictly prohibited without the express written permission of Stansberry & Associates Investment Research, LLC. 1217 Saint Paul Street, Baltimore MD 21202

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

Daily Wealth Archive

© 2005-2022 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in