James F. McDonough
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732-568-8360 jmcdonough@sh-law.comFirm Insights
Everyone Has An Opinion On Estate Tax Reform
Author: James F. McDonough
Date: May 4, 2015
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Currently, just about everyone has an opinion on estate tax reform.
A proposal to permanently repeal the federal estate tax has obtained approval in the U.S. House of Representatives, but there are many – including lawmakers, policy analysts and various kinds of experts – who have spoken their opinion on estate tax reform.
Opponents of abolishing the so-called death tax have contended that the policy hampers small businesses, giving them an unnecessary burden that can interfere with their ability to operate properly.
Advocates of repealing tax speak out
A perfect example of a lawmaker who has illustrated the cost of the federal estate tax is Rep. Kristi Noem, R-S.D., who explained that following her father’s death in a farming accident, her family needed to borrow money to pay off the estate tax burden, according to The Wall Street Journal.
“We owed [the government] money because we had a tragedy happen,” stated Noem, the media outlet reported. “It took us 10 years to pay off that loan.”
A burden for small businesses
Reps. Kevin Brady, R-Texas, and Steve Scalise, R-LA., also criticized the estate tax in a USA Today column, asserting that the policy forces many families to sell their small business simply to appease the IRS.
While those who oppose repealing the death tax assert that eliminating the levy would benefit the wealthiest Americans, Brady and Scalise asserted that farmers, ranchers and entrepreneurs – who have their wealth stored in assets like property, real estate and capital equipment – would suffer. As for the super rich, many have asserted that these Americans can find countless ways to reduce their tax burdens.
Finally, the authors cited figures from nonpartisan think tank The Tax Foundation, which reveal that repealing the estate tax will result in the creation of 139,000 new jobs and also increase worker compensation.
Regardless of which arguments are circulated, many political observers have emphasized that President Barack Obama has been quite critical of any efforts to eliminate the federal estate tax, and has threatened to veto any legislation that would enact this change should it reach his desk. Before the bill gets to the leader of the free world, it would need to get past the Senate, where its reception is unclear.
- Practices: Tax and Trusts & Estates, Estate & Trust Litigation, Real Property Tax Strategies
- Locations: Red Bank, NJ, New York City, Little Falls, NJ
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