What information does to the "uninformed" (formerly ignorant)

I had a conversation over the weekend with a relative. Now, this person generally agrees with much I say, and, with explanation, can see my point of view.

He is not a hard-core leftie, nor is he right-wing.

However, when he said that he was against the "death tax", I gave him some information. I think that the key thing that opened his eyes was the information that he was unaware of ... that, until recently, the inheritance tax did not kick in until the first penny AFTER two million dollars INHERITED.

(Mind you, he has some blood relatives that have ignored him, so he is ignoring them in his will, against my suggestions. My suggestion to him is to leave each of them $1, so that they can't say that someone made sure they were written out of his will ... the ungrateful snobs).

Once he saw the light about what the initial deference was, he had a better idea of how silly it sounded. He has never inherited a dime from his immediate family ... and he's the last living of his immediate family. (I'm his "cousin"-in-law)

on EVERY man, woman, and child no matter what income if we allow the Paris Hiltons to get off inherting millions without paying taxes on it.

We really need to show the public and particularly small business owners and family farmers/ranchers that the tax just doesn't apply to them unless they are ultra rich. The GOP plays this one like EVERYBODY gets taxed at death.

Time to dispell the disinformation

LOTS of LTTE and calls to talk shows will help.

just as an example, you can give $10,000 per-year per-donor, per-recipient as a tax-free gift.
that means that mommy and daddy can give junior and his wife $40,000 per year tax-free.

so you can give away quite a lot of money to your "heirs" while you're still living. tax-free.

and that doesn't even get into all the fun you can have with trusts and so on.


the bottom line is that actually paying estate tax is often a sign of poor planning or a sudden, early death or a very stubborn person who tried too hard to take it all with him.

You're correct re: non-taxable gifts, except the annual exemption is now $11K, IIRC, and should be going up to $12K soon.

However, even with rock-solid planning some estate tax will always be eventually payable if the estate is large enough. Tax can be deferred by leaving the estate to a spouse, but the only sure-fire way to avoid tax altogether is to leave everything above the exemption amount to charity.

my point is that there are plenty of games to play.

so if your net worth is "just over" the exemption amount, there are some tricks available to avoid the tax completely.

so if you actually have been rich for some time, have more than a tiny number of heirs, have done the proper planning, etc., and still had to pay the estate tax, then most likely your net worth was quite a bit over the exemption amount.

$10,000 or $11,000 or whatever it is

I'm going to have to talk to my tax person more . . . .

The family that is squabbling over the estate of the deceased patriarch (no, I'm not talking Anna Nichole Smith, but I did mention her and Paris Hilton to the cuz-in-law)

There's this family that might lose their "farm" due to inheritance taxes ... the daddy owned thousands of acres of land and had a tidy sum left to his kids ... oh, did I mention that the acres of land were on Hawai'i, the Big Island?

How much you wanna bet that, when they finally get the thing settled (without taxation, no doubt), they'll just turn around and sell a lot of the land for "development" and augment their multimillions even more?

"protect" the family farms and small businesses that they always point to, but, guess what.....the GOPs really WERE only in it for the richest inheritors and NOT the family farms and small businesses - surprise, surprise....the GOPs wouldn't support increasing it to 8 million.