Taxes: Estate

Taxes: Estate

The estate tax or “inheritance tax” is levied upon the transfer of the taxable assets of a deceased person.   First adopted in the nineteen century as temporary taxes to fund wars, the Federal estate tax in its current form has been on the books since 1916 as a vital instrument of progressive taxation.    The tax rate and exemption levels have changed over the years. A number of states also have estate taxes.  Recent attempts at repeal of the federal tax have been prevented but tax rates are lower and exemption levels higher.

Commentary

Taxes and the wealthy

Will Higher Taxes on the Rich Kill Jobs?

December 01, 2010

Cry Wolf Quotes

We believe that a tax system designed to penalize the small group of wealthy individuals for the benefit of the others injures all groups by diminishing the incentive to productive effort, thereby reducing the total output available for distribution, which really constitutes the national income. … We oppose this Federal tax program on the ground that high estate and inheritance taxes tend to dissipate the aggregations of wealth on which industry depends for its capital and on which the government depends for a substantial part of its revenue under the present income taxes.

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Guarantee Trust Company of New York, New York Times.
07/29/1935 | Full Details | Law(s): Tax: Estate

In considering a revision of estate taxes, there should be eliminated any question of levying the tax as a means of punishing wealth or as in some way for the social good of our civilization…The theory upon which this country was founded is equality of opportunity. So long as a man uses his abilities within the bounds of the moral sense of the community, monetary success is not a crime, but on the contrary adds to the total wealth of the country and to an increase in the standard of living as a whole.

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Andrew W. Mellon.
04/01/1924 | Full Details | Law(s): Tax: Estate

[The estate tax] represents a real tax on capital, and such a tax is necessarily unsound and unscientific because it tends to defeat itself as a revenue producer.

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F.W. Denio, American Bankers Association, Washington Post.
10/24/1925 | Full Details | Law(s): Tax: Estate

If America had not been free to any man to make his fortune within the law and within his abilities, we would not be the great nation we are today. To destroy incentive by excessive taxation is to lessen the production and the prosperity of the country.

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Calvin Coolidge, Los Angeles Times.
02/20/1925 | Full Details | Law(s): Tax: Estate

Evidence

Backgrounders & Briefs

Estate Tax Policy Brief

By Joseph J. Thorndike

Since at least the 1920s, estate tax opponents had been trotting out the same litany of warnings and complaints about the Estate Tax. 

Resources

The Center on Budget and Policy Priorities (CBPP) is a think tank focused on tax and fiscal policy. They provide in-depth analysis of state issues.

Citizens for Tax Justice is an organization that represents low and middle income citizens in the tax debates on Capitol Hill.