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Old 02-24-2011, 08:29 PM   #181
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You wouldn't happen to be drawing government wages or a government pension would you?

Ha
relevance? it is disappointing that even you will reduce yourself to making a discussion personal instead of discussing the ideas without bias.
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Old 02-24-2011, 08:36 PM   #182
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The relevance is because your perspective is so unashamedly pro-tax for you to be considering the private sector.
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Old 02-24-2011, 08:36 PM   #183
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relevance? it is disappointing that even you will reduce yourself to making a discussion personal instead of discussing the ideas without bias.
Come on, you will have to admit that your comment is pretty funny. How could there not be bias in discussing something like this? After all, it's game of tug of war, and you are on the other team. I don't criticize you for it at all, same as I don't criticize myself for opposing the tax and spend agenda.

BTW, you didn't answer. To me, it is like touting a stock, and not disclosing that you own 10,000 calls on it.

Ha
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Old 02-24-2011, 08:46 PM   #184
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But, I have just never thought the inheritance tax was fair. The money was already taxed and I just don't think there should be tax on leaving your money to others.
I guess what I am struggling with in this whole discussion is what makes a tax fair? It's easy to look at a specific tax in isolation and say that doesn't seem right, it's not fair and should be repealed.

But the reality of the tax burden is that if the estate tax is lifted, somebody else has to make up the difference. Who should that somebody be? Should we tax other wealthy people who didn't happen to get a large inheritance more to make up the difference? This doesn't seem right either. Alternatively we could tax middle/lower class more to make up the difference since their marginal rates are lower. Would this be fair?
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Old 02-24-2011, 10:04 PM   #185
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I guess what I am struggling with in this whole discussion is what makes a tax fair? It's easy to look at a specific tax in isolation and say that doesn't seem right, it's not fair and should be repealed.

But the reality of the tax burden is that if the estate tax is lifted, somebody else has to make up the difference. Who should that somebody be? Should we tax other wealthy people who didn't happen to get a large inheritance more to make up the difference? This doesn't seem right either. Alternatively we could tax middle/lower class more to make up the difference since their marginal rates are lower. Would this be fair?
I don't think it unusual that we are having a discussion regarding the fairness of the estate tax. Politicians have wrangled with this very thing for years.

I question the assumption that if the money is not paid by the decedents that ...the money has to come from somewhere from some other taxpayers.
It could just as easily come from reduced government spending.
It doesn't have to be a "who". Oh heck...take it from that multi million dollar grant to study the sex habits of the firefly.
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Old 02-24-2011, 10:16 PM   #186
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"Don't tax me and don't tax thee. Tax that man behind the tree."

By the time an estate tax bites me, I'm not really in a state to be much concerned about it, frankly. Any heirs might be annoyed, but heck, I sure hope they weren't counting on my timely death, and it's their problem anyway.

There are better ways to spend the day than worrying about taxes after death. Kittens, for example. Or puppies. Or grandkids, eventually...

So, don't get too worked up about it. It's not like the government could balance it's budget on estate taxes.
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Old 02-24-2011, 10:20 PM   #187
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It could just as easily come from reduced government spending.
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Old 02-24-2011, 10:25 PM   #188
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The relevance is because your perspective is so unashamedly pro-tax for you to be considering the private sector.
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Originally Posted by haha View Post
Come on, you will have to admit that your comment is pretty funny. How could there not be bias in discussing something like this? After all, it's game of tug of war, and you are on the other team. I don't criticize you for it at all, same as I don't criticize myself for opposing the tax and spend agenda.

BTW, you didn't answer. To me, it is like touting a stock, and not disclosing that you own 10,000 calls on it.

Ha
i am not pro tax as you put it but i do realize that we arent gonna get out of this national debt problem with just spending cuts. when it comes to my arguement on the validity of the estate tax, how bout you point out the fallacy of my logic instead of assuming bias on my part. is it because there isnt a flaw in my logic?
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Old 02-24-2011, 10:27 PM   #189
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ok, how bout this:
1) repeal the Bush tax cuts for incomes over $200k for singles and $250k for married
2) a new bracket at $600k income with a rate of 47%
3) a new bracket at $1M income with a rate of 55%

and while we are at it lets remove the cap on FICA and put another knee in the the computation of benefits formula: only 5% of the average monthly wages above the $9k/mo level get added in the benefits formula
This would be brutal...and have dire consequences to our society and economy.
There would be no incentive for people to make $600,000 or 1 million. Why would they. I personally would try hard to stay below the 250 K for couples.

Not to worry...in 3 years it will happen for me and my tax bill will go down dramatically ! Whoopeee!!!
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Old 02-24-2011, 10:30 PM   #190
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I question the assumption that if the money is not paid by the decedents that ...the money has to come from somewhere from some other taxpayers.
It could just as easily come from reduced government spending.
I think it's easiest to think about the problem in terms of a fixed tax burden as money is fungible.

Of course, the estate tax could be paid out of reduced government spending, but the question is still essentially the same. If we reduce gov spending (and the overall tax burden), why should wealthy people inheriting an estate get the benefit. Why shouldn't middle class/upper class/X people get the benefit?
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Old 02-24-2011, 10:43 PM   #191
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There's only one thing I can say about the "taxed twice" argument, I know that I pay taxes twice or three times on the "same money". It happens.

But regarding the last paragraph. I don't know why the rest of us should care whether the heirs sell the company or keep it.

If somebody else is more optimistic about running it for a profit, let the heirs sell and the new owner will try some changes that may improve things. The heirs will take the sale proceeds and recycle them into the economy where they will "create jobs" one way or another.

If nobody believes the company can be run profitably, then it's time to close it down. The heirs will sell the hard assets and recycle the proceeds. The employees will have to find jobs with other firms with better profit prospects. That's unpleasant for everybody involved, but it happens every day somewhere in our economy. I can't see why the fact the company is changing hands due to a death means that the government should somehow try to keep it going if it doesn't look profitable to anyone.
The rest don't have to care. But if we all want jobs in this country for ourselves and our children...it might be prudent to do so.

How important are small businesses to the U.S. economy?
Small firms:

Represent 99.7 percent of all employer firms.
Employ just over half of all private sector employees.
Pay 44 percent of total U.S. private payroll.
Have generated 64 percent of net new jobs over the past 15 years.
Create more than half of the nonfarm private gross domestic product (GDP).
Hire 40 percent of high tech workers (such as scientists, engineers, and computer programmers).
Are 52 percent home-based and 2 percent franchises.
Made up 97.3 percent of all identified exporters and produced 30.2 percent of the known export value in FY 2007.
Produce 13 times more patents per employee than large patenting firms; these patents are twice as likely as large firm patents to be among the one percent most cited.
Sources (see the Office of Advocacy's Research and Statistics page):

U.S. Dept. of Commerce, Bureau of the Census and International Trade Admin.
Advocacy-funded research by Kathryn Kobe, 2007
CHI Research, 2003
U.S. Dept. of Labor, Bureau of Labor Statistics.
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Old 02-24-2011, 10:54 PM   #192
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I think it's easiest to think about the problem in terms of a fixed tax burden as money is fungible.

Of course, the estate tax could be paid out of reduced government spending, but the question is still essentially the same. If we reduce gov spending (and the overall tax burden), why should wealthy people inheriting an estate get the benefit. Why shouldn't middle class/upper class/X people get the benefit?
There are too many assumptions in this for me to address objectively.

Who said...wealthy people were inheriting ?
Why should Jo Blow....get the benefit that my parents (or anyones parents) sacrificed their entire lives for...including sacrificing family.? Did Jo Blow...do anything to get it? Think about it.

It's the "give me something" for "nothing"...that really ...really gets to me.

I'm all for anyone getting welfare and certain forms of government assistance...to have to perform community service hours in return.

I have a neighbor on disability...for a back injury. It is really funny(not) watching him pretend to be disabled. He walks with his cane out in the public. But I watch him power wash his own house, mulch his own beds..heck..even drove his brand new sports car cross country.. .etc. He's been doing this for close to 18 years.
People cheat the system...which is why ALL the entitlements are out of hand....which it part of this increase tax ...and tax the rich...stuff.
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Old 02-24-2011, 10:57 PM   #193
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"Don't tax me and don't tax thee. Tax that man behind the tree."

By the time an estate tax bites me, I'm not really in a state to be much concerned about it, frankly. Any heirs might be annoyed, but heck, I sure hope they weren't counting on my timely death, and it's their problem anyway.

There are better ways to spend the day than worrying about taxes after death. Kittens, for example. Or puppies. Or grandkids, eventually...

So, don't get too worked up about it. It's not like the government could balance it's budget on estate taxes.
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Old 02-24-2011, 11:26 PM   #194
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How important are small businesses to the U.S. economy?
Small firms:

Represent 99.7 percent of all employer firms.
Employ just over half of all private sector employees.
Pay 44 percent of total U.S. private payroll.
...
Those are small businesses by the SBA definition, which are (generally) companies with 500 or fewer employees. (There's a huge table by industry that breaks out all the criteria for being an SBA small business. http://www.sba.gov/sites/default/fil...ards_Table.pdf If you make plastic footwear or nitrogenous fertilizer you can be a small business with up to 1000 employees, but if you're an auto wholesaler you can only have 100.)

Estate taxes generally apply to what the IRS calls a small business, which are sole proprietors, partnerships, or S corporations. Most of these are nonemployer firms, and the few employer firms almost all have 9 or fewer employees. (US Census Bureau Statistics of US Business, published 2002)

Not all that many of the businesses you mention as job creators are subject to inheritance taxes.

I only bring this up because the gag of using the SBA definition of small business to argue about inheritance taxes which apply to a subset of the much smaller set of IRS small businesses is one of my favorite ways of misleading with statistics.
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Old 02-24-2011, 11:27 PM   #195
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i am not pro tax as you put it but i do realize that we arent gonna get out of this national debt problem with just spending cuts. when it comes to my arguement on the validity of the estate tax, how bout you point out the fallacy of my logic instead of assuming bias on my part. is it because there isnt a flaw in my logic?
Spending cuts aren't what got us into this mess, folks with a bias for "tax and spend " are what did. The flaw in your logic is that you expect that we can keep doing the same thing and expect different results.
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Old 02-24-2011, 11:31 PM   #196
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This would be brutal...and have dire consequences to our society and economy.
There would be no incentive for people to make $600,000 or 1 million. Why would they. I personally would try hard to stay below the 250 K for couples
Progressive taxation doesn't tax your entire income at the highest rate. No need to "try hard" to stay below 250k. If you make 251k, the first 250k is taxed at the same <250k rate, and the 1k is taxed at the 250+k rate. It's not like you make one extra dollar and suddenly all your 250k is taxed an extra 15 or 20%.
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Old 02-24-2011, 11:33 PM   #197
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Spending cuts aren't what got us into this mess, folks with a bias for "tax and spend " are what did.
Nah. It's the folks with the bias for "spend and simultaneously cut taxes" who got us into this mess.

People in this thread haven't argued for "taxing and spending". They've been arguing for cutting spending and simultaneously raising taxes. An entirely different mindset from what got us where we are.
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Old 02-25-2011, 12:20 AM   #198
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Spending cuts aren't what got us into this mess, folks with a bias for "tax and spend " are what did. The flaw in your logic is that you expect that we can keep doing the same thing and expect different results.
1st, there havent been any spending cuts, what got us into this mess was a lack there of and
2nd it figures that someone who doesnt have a reasonable argument to the point i made about estate taxes would try to misrepresent what i said. you state that i am in favor of tax and spend but i have never said that. what i have said was that the only way out of the mess we are in is cut spending and increase taxes, that is not the classic "tax and spend" mentality. but that is totally off topic since what i asked for was a rebuttal of my logic supporting the validity of estate taxes which i made in these posts
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in this country all transfers of money (or monetary assets) from 1 person (or corp) to another that increases the monetary assets of the 2nd person is taxable. for example, in repayment of debt, the principle isnt taxable since it is already an asset of the person receiving the repayment but the interest is taxable. another example is wages; when someone receives a paycheck that person's monetary assets were just increased by the size of the wages so the wages are taxed. all inheritance is an increase of monetary assets to the ones receiving said inheritance so it stands to reason that it would be taxed also. even gifts are taxable, it just so happens that for gifts the tax code has some big exemptions (yearly, life time and to nonprofit orgs). the estate tax shares the gift tax life time exemption. if anything the unfair part of the estate tax is the sizeable exemption, maybe the exemption should be eliminated for fairness sake.
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i disagree, as my previous post point out, it is very appropriate since the receiver is getting an increase in monetary assets. all other such transfers are taxable, why not this 1?
which i notice you also didnt address. please stop putting words in my mouth.
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Old 02-25-2011, 01:01 AM   #199
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There are too many assumptions in this for me to address objectively.

Who said...wealthy people were inheriting ?
Why should Jo Blow....get the benefit that my parents (or anyones parents) sacrificed their entire lives for...including sacrificing family.? Did Jo Blow...do anything to get it? Think about it.
I thought there was an exclusion of $5 million on the estate tax. So anybody paying it would be pretty wealthy even if it split amongst a few siblings. Did I make a mistake here?

The point I wanted to make was that you can't evaluate the fairness of a tax in isolation. You really have to look at the entire system.

Your comment about "Jo Blow" getting a benefit from the estate tax is no different from any other tax. I paid tens of thousands of dollars of income tax this past year for which I saw no benefit. Why should others benefit from my hard work? Why can't they pay for their own benefits by themselves. Did Jo Blow do anything to deserve my tax money? I worked very hard to earn it and it's just been taken away from me and given to others.

I think if you think about taxes in terms of what's "fair" you will never be satisfied by any tax system. Some people will always end up paying more to the government than they get back in benefits. Although the US is a capitalist society, we still believe in help those less fortunate than ourselves. That means that people with good incomes/fortune will end up paying more in taxes than they ever recover from government benefits.

Regarding your neighbour, I think you should videotape him and report him for fraud. That would help get our overall tax burden down.
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Old 02-25-2011, 07:55 AM   #200
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On the tax side, you seem to be mixing individual FIT and total tax collections - the 25.5% is total, the $899b is individual income only. I don't follow this. The 25.5% is FIT effective tax rate from the CBO, what other taxes are you saying are included?

I see the top 1% paying about 19% in individual income taxes in 2005 (table 1A). If I do: number of families * (average income - minimum income) for the top 1% I get about $1.4 trillion in income. If we added an extra 10% onto their tax rate (which might mean raising the 15% cap gains rate to 30% and not changing the rate on ordinary income, I haven't done the math) that would generate $140 billion in revenue from just that 1%, while increasing their average individual FIT rate to about 27%.

Now $140 billion doesn't close the deficit. But it's not trivial either. Doesn't come close to closing the deficit. My initial post was directed at several people who repeatedly offer taxing the rich as the solution - and it doesn't begin to address the deficit. Unfortunately it is relatively trivial - it's going to take so much more.
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