Buddhist Catholic Contemplative Evangelical General Christian Hindu Jewish Latter-day Saint Muslim New Visions Progressive Christian

Beliefs

Topics

Columnists

Resource Library

Research Tools

Video

Podcasts

Thought Readers

Faith In Media Tracker

Newsletters

Ad-Free & Subscriber Log-In Subscription Support

Follow Patheos

Home
Evangelical
Politics and Religion
If you have a big estate, die or give it away by January 1

If you have a big estate, die or give it away by January 1

Last updated on: December 19, 2012 at 5:45 am by Gene Veith

0 Comments

If you have a big estate, die or give it away by January 1 2012-12-19T05:45:27-05:00 Gene Veith

LOGO Patheos Explore the world's faith through different perspectives on religion and spirituality! Patheos has the views of the prevalent religions and spiritualities of the world.

Income taxes for everyone are not the only taxes that will jump up, should we jump off the fiscal cliff. The estate and gift taxes will also soar dramatically. George Will is sardonic about it:

If you have worked hard for five decades, made pots of money and now want to squander it all in Las Vegas on wine, women and baccarat, go ahead. If, however, you harbor the antisocial desire — stigmatized as such by America’s judgmental tax code — to bequeath your wealth to your children, this would be an excellent month to die. Absent a congressional fix before Jan. 1, the death tax, which is 35 percent on estates above $5 million, reverts to 55 percent on those above $1 million.

via George F. Will: Fixing the tax code at the cliff’s edge – The Washington Post.

Rather than dying, many wealthy folks are giving their money away to their heirs, something else that will be heavily taxed after January 1. From CNN Money:

Currently gifts and estates of up to $5.12 million are exempt from taxes, but as part of the fiscal cliff, any portion of a bequest that exceeds $1 million will be taxed next year — and at a 55% rate (currently, the rate is 35%). That will kick in unless Congress and the president agree to extend the current exemption or agree on a new one. Many older Americans are not waiting to see if that happens.

“It’s crazy,” said Richard Behrendt, Director of Estate Planning for Baird’s Private Wealth Management. “I bet more wealth is transferred this year than in the past 10 years combined.”
Jonathan Blattmachr, a principal of Eagle River Advisors in New York who has lectured groups of estate planners about the expiring exemption, said the amount given away in 2012 will be three or four times that of any other year.

The drop to a $1 million exemption means that the tax bill on gifts or estates of $5.12 million will go from zero this year to $2.266 million next year, according to Blattmachr.

What do you think about the estate tax? One strain of puritanism has always disapproved of the “idle rich,” such as those trust fund kids on Lifestyles of the Rich and Famous jetting to Monaco and other of the world’s playgrounds. The thought is, people should earn their wealth by hard work, not just live off of the hard work of their forebears.

Then again, inheritance is related to the unity of the family across generations. Also, those with inherited wealth are not necessarily “idle,” since they usually have to keep the family business in good working order.

The inheritance tax is often devastating to farmers and owners of small businesses. Farmers are often cash poor, but land rich. That is, the soaring price of land makes them wealthy on paper, in terms of assets, but they don’t necessarily have much actual money. Frequently, when the landowner dies, the farm has to be sold to pay the estate taxes. The heirs don’t have that kind of money even if they want to continue the family farm. The same can hold true for small businesses, which often have to be dissolved upon the death of the owner when the heirs can’t come up with the cash to pay the inheritance tax.

Previous Post

December 19, 2012

The one black Senator

Next Post

December 19, 2012 Melanchton on Fables

Recent Comments

0 | Leave a Comment

"While she worked for Trump she was a tool's tool!"

reg

Luther on Tools

"I know wired earbuds are making a comeback (I never stopped using them as I ..."

reg

Luther on Tools

"VCRs, tape decks, and cassette players are all having a revival among a segment of ..."

Tom Hering

Luther on Tools

"As a (retired) lawyer I see potential liability from sharing things like power or sharp ..."

reg

Luther on Tools

Browse Our Archives

Select a Category America Apologetics Art baseball Bible Blog Christ Church crime Culture Economics Education Ethics Family Food Football Government History Holidays Holy Week Humor International Islam Language Law Life Issues Literature Media Medicine Movies Music Nature News Personal Philosophy Politics psychology Reformation Religions Sacraments Science sex Social Science Sports technology television terrorism Theology Uncategorized Vocation war

Select a Month October 2026 September 2026 August 2026 July 2026 June 2026 May 2026 April 2026 March 2026 February 2026 January 2026 December 2025 November 2025 October 2025 September 2025 August 2025 July 2025 June 2025 May 2025 April 2025 March 2025 February 2025 January 2025 December 2024 November 2024 October 2024 September 2024 August 2024 July 2024 June 2024 May 2024 April 2024 March 2024 February 2024 January 2024 December 2023 November 2023 October 2023 September 2023 August 2023 July 2023 June 2023 May 2023 April 2023 March 2023 February 2023 January 2023 December 2022 November 2022 October 2022 September 2022 August 2022 July 2022 June 2022 May 2022 April 2022 March 2022 February 2022 January 2022 December 2021 November 2021 October 2021 September 2021 August 2021 July 2021 June 2021 May 2021 April 2021 March 2021 February 2021 January 2021 December 2020 November 2020 October 2020 September 2020 August 2020 July 2020 June 2020 May 2020 April 2020 March 2020 February 2020 January 2020 December 2019 November 2019 October 2019 September 2019 August 2019 July 2019 June 2019 May 2019 April 2019 March 2019 February 2019 January 2019 December 2018 November 2018 October 2018 September 2018 August 2018 July 2018 June 2018 May 2018 April 2018 March 2018 February 2018 January 2018 December 2017 November 2017 October 2017 September 2017 August 2017 July 2017 June 2017 May 2017 April 2017 March 2017 February 2017 January 2017 December 2016 November 2016 October 2016 September 2016 August 2016 July 2016 June 2016 May 2016 April 2016 March 2016 February 2016 January 2016 December 2015 November 2015 October 2015 September 2015 August 2015 July 2015 June 2015 May 2015 April 2015 March 2015 February 2015 January 2015 December 2014 November 2014 October 2014 September 2014 August 2014 July 2014 June 2014 May 2014 April 2014 March 2014 February 2014 January 2014 December 2013 November 2013 October 2013 September 2013 August 2013 July 2013 June 2013 May 2013 April 2013 March 2013 February 2013 January 2013 December 2012 November 2012 October 2012 September 2012 August 2012 July 2012 June 2012 May 2012 April 2012 March 2012 February 2012 January 2012 December 2011 November 2011 October 2011 September 2011 August 2011 July 2011 June 2011 May 2011 April 2011 March 2011 February 2011 January 2011 December 2010 November 2010 October 2010 September 2010 August 2010 July 2010 June 2010 May 2010 April 2010 March 2010 February 2010 January 2010 December 2009 November 2009 October 2009 September 2009 August 2009 July 2009 June 2009 May 2009 April 2009 March 2009 February 2009 January 2009 December 2008 November 2008 October 2008 September 2008 August 2008 July 2008 June 2008 May 2008 April 2008 March 2008 February 2008 January 2008 December 2007 November 2007 October 2007

TAKE THE

Religious Wisdom Quiz

What Christian tradition is associated with the seven sacraments?

Select your answer to see how you score.

Protestantism Roman Catholicism Quakerism Seventh-day Adventism

Books by This Author Books by Gene Veith

See All Titles »