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  • Who Profits from the Death Tax? Estate Planning Lawyers.

    If you ask attorney Harold Apolinsky who really profits from the death tax, he’ll tell you, “I think I do, as an estate planning lawyer,” but then he will tell you why the tax needs to be permanently repealed.

    According to Apolinsky, the death tax (or estate tax, as it is also known) taxes the transfer of a business from the deceased to their heirs upon death at an extraordinarily high rate. The tax first came into law in 1917 in order to pay for World War I, was abolished this year, but is set to come back in 2011 at a 55% rate and $ 1 million exemption.

    Apolinsky, who helps families plan for the death tax, says it truly can be deadly for small companies. He observes that most successful businesses don’t have “buckets of cash” laying around to pay the tax, and they face the impossible choice of setting money aside, expanding their business, hiring new employers, or paying hundreds of thousands of dollars to insurance companies to fund a life insurance policy that covers their death tax obligation.

    That just doesn’t make sense, Apolinsky says, in a country built on capitalism and free enterprise. “If you’re going to take away half the value of a business every generation, how can it grow?” he asks, while also noting that Sweden and Australia have repealed death taxes because they want family businesses to grow larger and provide more jobs.

    The Heritage Foundation as looked at family businesses in America who are suffering the effects of the death tax. Watch the following videos to learn more:

    Hancock Lumber

    Reliable Contracting

    Grande Harvest Wines

    Learn more about the death tax at heritage.org/deathtax.

    Do you have a comment or your own story to share? Leave a comment below and join the conversation.

    Posted in Ongoing Priorities [slideshow_deploy]

    19 Responses to Who Profits from the Death Tax? Estate Planning Lawyers.

    1. Stephen Bloom, Penns says:

      As an estate planning attorney, I totally agree. The Estate Tax is a permanent employment program for lawyers, and a destructive enemy for productive enterprises.

    2. J.C. Hughes, Texas says:

      Let's see… The congressional Democrats and Obama administration are not only going to tax the unborn, but the dead as well. Where does it all end? The real need demanding reform is restructuring America’s outdated tax laws. The days of big exploitative government must be abolished. It’s long time these elected incompetent fools be replaced before they destroy the nation.

    3. John Cooper says:

      Probably the biggest beneficiary of the estate tax is the American Cancer Society. Their primary business is getting people to sign over their assets to the ACS avoid the estate tax. The do that estate planning for 'free'.

    4. jerry bertolini, m.d says:

      why can't illinoisans remove mike madigan from office by petition for conflict of interest regarding real estate taxes?

    5. software generator says:

      Great article . Will definitely apply it to my website

    6. Fabien Benjamin says:

      I would love to see this country go to the polls in November and all who are voted out should immediately be sent to prison for Corruption of the the American people and especially thier districts and states.

    7. Sara Reynolds MD says:

      I saw the tax burden cause problems when my father, a fairly prostperous farmer, died unexpedly of a heart attack. Becuause he had not formally turned over the farm to my brother over 3 years before his death, a substantial tax was levied. This was in the early '60s and the % was not so bad, but it was a problem even then.

    8. Art Pauly, Roseville says:

      The title of your article seems to demonize the Estate Planning Attorney. I am an Estate Planning Attorney. I believe the tax should be repealed. A good qualified Estate Planning Attorney can save the family business if the business owner is willing to act. Most don't. It's very simple. Find a good qualified Estate Planning Attorney and follow their recommendations, then clean house in Washington, DC and in the State Capitols at the ballot box.

    9. Dennis Social Circle says:

      The death tax is wrong, each member of the family contributed to the sucess of the family business, farming or whatever type of business. Each member should be entitled to a part, the "guvement", should not get any part. The taxes have already been paid as profit was made. This is just a tax on a tax. That is all the dems and obama think about, tax tax and more tax.

    10. Lloyd Scallan - New says:

      Just another aspect of Obama ideology to "spread the wealth". Regardless of

      who this tax benefits, it is still a theft from the citizens of this nation.

    11. Mark, DC says:

      Not only do estate lawyers make out well (despite publically calling for a repeal), but also life insurers in a big way. They lobby to keep their tax-incentivized business alive – setting up trusts that own life insurance whose proceeds are paid out estate tax free and whose income grows estate tax free (the cash inside a variable life insurance policy). It costs a pretty penny, but squeak in under what the government would steal from your family after you die. It's been the bain of my family's existance for the past several years. It took a year of my Dad's life to setup with estate lawyers and retitling all his assets to the trust. Then he passed away in 2008, and it took me a year of paperwork to file the estate tax. I know have to worry about the best way to pay for Mom's life insurance and worry that the life insurers aren't going under for the rest of Mom's life. And all this for a tax whose revenue is only about 1% of federal revenue. YEARS of productivity wasted, as the gov't wastes my Dad's hard-earned & quadruple taxed money. It's the antithesis of the American dream. Why can't the government shrink spending by 1% and give us back our legacies! With the government taxing every activity possible, it's no wonder charities are having trouble.

    12. Dave Boner, Stillwat says:

      The Death Tax is a form of robbery without a gun. It violates our sense of free enterprize and fairness. I would be interested in hearing the reasons for legislating the Death Tax?

      I find it interesting that an Estate Planning Law Firm is a small business who will have to contend with the Death Tax as well. The law is rediculous and should be repealed.

    13. Bobbie Jay says:

      terrible karma.

    14. Pat Smith Kansas says:

      My husband's parents worked their whole lives to have 2 small parcels of land that they farmed, they wanted their children to keep the farms in the family so they paid a lawyer to form a trust with my husband as the Trustee to keep it. This cost them thousands to form this trust. My husband got cancer so he made a trust so I would inherit his share. This cost us over $10,000 with a lawyer who was supposed to be a friend and promised us he would do it cheap but he never would tell us how much he would charge till after he did it. We were desperate because my husband was told he would die in 2 weeks so we let him do it. My husband's sister was the trustee after he died and she didn't want to handle the farms so she decided to sell them in spite of me not wanting her to.I got $150,000 from the sale which I had to pay nearly $50,000 in taxes. The only winners are the lawyers and the government because they got thousands from the lifetime earnings of 3 people with taxes and paperwork to try and keep it in the family, when one family member threw it away. Now I have no land, $100,000 in the bank which I will be taxed on till I die and now be kids will get taxed on it and the government gets half again. We are slaves again.

    15. Pat Smith Kansas says:

      My husband's parents worked their whole lives to have 2 small parcels of land that they farmed, they wanted their children to keep the farms in the family so they paid a lawyer to form a trust with my husband as the Trustee to keep it. This cost them thousands to form this trust. My husband got cancer so he made a trust so I would inherit his share. This cost us over $10,000 with a lawyer who was supposed to be a friend and promised us he would do it cheap but he never would tell us how much he would charge till after he did it. We were desperate because my husband was told he would die in 2 weeks so we let him do it. My husband's sister was the trustee after he died and she didn't want to handle the farms so she decided to sell them in spite of me not wanting her to.I got $150,000 from the sale which I had to pay nearly $50,000 in taxes. The only winners are the lawyers and the government because they got thousands from the lifetime earnings of 3 people with taxes and paperwork to try and keep it in the family, when one family member threw it away. Now I have no land, $100,000 in the bank which I will be taxed on till I die and now my kids will get taxed on it and the government gets half again. We are slaves again.

    16. Drew Page, IL says:

      Most Americans die without leaving much to surviving childrem, other than Life insurance benefits to cover their final expenses and/or their homes, or the equity in such homes. As is most often the case, the estates of most Americans do not amount to $1 million. Since the overwhelming number of Americans do not have to worry about Estate Taxes, they don't concern themselves with the existence of such a tax. This is why the government can get away with this.

      Just like most Americans don't fall into the upper 5% of all income earners, they don't care when the government says we are going to increase the tax only those in the upper 5% of income earners. However, many of those in the upper 5% are small business owners, who employee a vast number of Americans. The more these people are taxed the fewer employees they can keep on their payrolls.

      In the U.S. today, we have in power a government dedicated to spending money they don't have, nor will they have for generations to come. It is irresponsible and reckless spending, but always with the excuse that they are helping people.

      I have an idea, let people decide for themselves how much they want to help others.

      Government controlled Fannie Mae and Freddie Mac were primarily responsible for causing the housing crisis and the banking crisis in the U.S. It started with the Community Reinvestment Act, under JImmy Carter. The intention was to have government controlled lending institutions give mortgages to lower income americans so they could "relaize the dream" of owning their own home. Bill Clinton upped the ante when he pushed the banks to make more of these loans, even if it meant lowering standards of credit worthiness, going so far as to set quotas on the number of such loans banks would be required to make.

      Mr. Clinton wanted to be a "good guy" and help lower income people "realize the dream". "See what I did for you?" "Remember me at election time". Predictably, the loans to those who were not creditworthy were not repaid. Homes went into foreclosure. The banks were out the money, at least for awhile, but since Fannie and Freddie were government backed, they had to be bailed out by the taxpayers. Now there had to be bailouts of those who were given mortgage loans they couldn't afford. Here we go again, the liberals have a new crop of people to feel sorry for along with politicians who want to come to the rescue (with our tax dollars) in order to buy themselves the votes of people who bought what they couldn't afford..

      This kind of thinking has spread to the people who run up bills on their credit cards. You see these legal firms on TV advertising that if you have credit card bills of $10,000 or more they can bail you out for penny's on the dollar. "The banks got bailouts, don't you deserve one too?"

      Everone should be able to have whatever they want and not have to pay for it and we have the politicians who tell you it's your right to expect it. You don't have health insurance, food, housing, a college education, a car, TV set, cell phone, nice clothes or beer money? Well, damn it, you have a Constitutional right to these things, just ask any liberal, or any Democrat running for office and they will confirm it for you. And to those who have a job, well by God, it's your responsibility to provide these things, just ask any Democrat.

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    19. CMartel2 says:

      You would think that as a family ages, they could sell their for a penny to their heirs, who would allow them to continue living on the land or what have you.

      Perhaps I'm mistaken about this? Whatever way to avoid our vile government is the way to go.

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