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
Cry Wolf Quotes
It is proposed to take capital and to use it in the ordinary operating expenses of Government…We are thus to live, not on income, but on principal, and to that extent we exhaust our resources and prevent the industrial expansion essential to our increasing population and our high standard of living.
Income and inheritance taxes which are in effect confiscatory destroy themselves by transferring capital in private hands, essential to private enterprise, to unproductive public funds.
The Federal Government should keep estate taxes as a reserve in times of national stress. All prior inheritance taxes have been war taxes; and it is only now that it is proposed to destroy this reserve in times when revenues from other sources are adequate and even in excess of the Nation's needs. Such a course of action is not only thoroughly unsound but borders on economic suicide.
These taxes are a levy upon capital. There is no requirement in our law, as there is in the English law, that the proceeds from estate taxes shall go into capital improvements of the Government. In other words, capital is being destroyed for current operating expenses and the cumulative effect of such destruction cannot fail to be harmful to the country.
Related Laws and Rules
Evidence
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Estate Tax Basics
The Center on Budget and Policy Priorities explains the reality of the much-mythologized estate tax.
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Conservative Commentator Examines the History of Right-Wing Tax Cut Hypocrisy
Hard right-wingers fear-monger in the face of tax increases of both Republican and Democratic administations.
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Tax Cuts on the Rich Don't Spur Economic Growth
The Center for American Progress takes apart supply side myths.
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.
