The fate of small, family-owned businesses hangs in the balance as Congress decides whether or not to finally put the crippling 55% death tax in a coffin. The toll the death tax takes on family-owned businesses has been clearly documented as has its infeasibility as a federal budgetary tool. But just as important as these concerns is the erosion of individual liberty that this tax presents. Alexis de Tocqueville recognized the role of inheritance laws in a free society in his Democracy in America: Through [inheritance laws] man acquires a …
Lunch With Heritage Chat with Curtis Dubay
For the second time in a week, Senate Finance Committee Chairman Max Baucus (D–MT) has called for the suspension of pay-as-you-go (PAYGO) budget rules to pass necessary and vital tax policies. First, Baucus suggested waiving PAYGO as it pertains to the death tax. Now he’s calling for the Senate to rightly ignore PAYGO so it can keep the tax rate on dividends from skyrocketing to almost 40 percent from its current 15 percent level. The 2001 and 2003 tax relief packages expire at the end of this year. That means …
The federal estate tax, better known as the death tax, was eliminated this year after a decade-long phase-out. Nothing in Washington is permanent, however, and due to a quirk in budget law, it comes roaring back to life in 2011 (less than four months from now) at a 55 percent rate and only $1 million exemption—its levels prior to the phase-out—unless Congress acts before the end of the year. There have been sporadic efforts in the Senate this year to address this impending massive tax hike that will threaten the …
In many respects, Dan L. Duncan was the embodiment of the American dream, the self-made man incarnate. He transformed $10,000 and two propane trucks into a natural gas empire and a personal net worth of $9 billion—making him the richest person in Houston, and the 74th wealthiest individual in the world. Even though Duncan died last March, his story provides the “only in America” narrative that seems to be lacking in this brave new era of big government and dwindling faith in the individual.
The American people are already well aware of President Barack Obama’s historic expansion of government spending: his $862 billion economic stimulus that has completely failed to keep unemployment below 8% as promised; his still-expanding health care law which the Congressional Budget Office now admits will cost more than $1 trillion; and an Obama budget that increases government spending by $12,000 per household. But all that spending is just the first half of President Obama’s game plan. The second half of Obama’s attempted transformation began last night when the Senate rejected …
After months of inactivity, the Senate could finally address the death tax in the coming days. It is about time it acted, because in a little over five months—January 1, 2011—the death tax will rise from 0 percent all the way to 55 percent. Proponents of the death tax make several arguments about why Congress should allow the death tax to resume hurting families and harassing family-owned businesses and farms. The most common arguments in favor of the death tax are:
Almost seven full months into 2010, the Senate might finally get around to addressing the death tax. The death tax expired on January 1 of this year, but because of a quirk in the budgeting process it will rise from the ashes in 2011 with a punitive 55 percent rate and less-than-generous $1 million exemption level unless Congress acts soon. The long delay in the Senate has lead many to conclude that Senate Majority Leader Harry Reid (D–NV) does not want to address the death tax at all this year …
Senators Sanders (I-VT), Harkin (D-IA) and Whitehouse (D-RI) are circulating a bill that would drastically increase the death tax at the worst possible time: such a policy move would be a body blow to a weakly recovering economy and would clearly signal to everyone that this Congress has no intention of breathing new life into the American dream. The death tax is currently expired for 2010. The repeal of the death tax was a decade-long policy first brought into law with the 2001 tax relief package. That legislation phased down …
In a front page article today, the New York Times has a story on the federal death tax and the impact its 2010 expiration has on a recently deceased billionaire. The article is riddled with errors, but the title of the article encapsulates perfectly the story’s biggest flaw: “Legacy for One Billionaire: Death, but No Taxes.” Billionaire Dan Duncan died in March of this year and left his family a considerable estate. Because the death tax does not apply for 2010, the New York Times wrongly claims that his heirs …
