My jaw hit the floor of my truck when I heard the numbers.
20 billion dollars in revenue.
You might figure that when 75,000 people get a $20 billion handout from Congress it must be to fund research into some rare disease.
Or, knowing Congress, it might just be the worldâ€™s biggest greed-grab.
If you guessed the latter, youâ€™d be correct.
Friends, todayâ€™s topic on the NoMoreGreed radarscope is the battle raging in Congress over elimination of the so-called â€œDeath Tax.â€Â You know what weâ€™re talking about.Â Weâ€™re talking about the â€œEstate Tax.â€Â Itâ€™s the tax that some in Congress claim is so vastly unfair, so grossly overreaching, and so heinously excessive that it must be eradicated for all eternity right here and right now.
Polls have told politicians that the public will react more favorably to their cause if they call the â€œEstate Taxâ€ a â€œDeath Tax.â€Â I suppose calling it a â€œDeath Taxâ€ makes common folks feel like they are just as much at risk of paying it as the next guy.
The truth is you stand a bigger chance of hitting the $5 lottery than paying the Estate Tax.
How large of an estate must you pass on before you pay the tax?
If you are single you donâ€™t even get a whiff of paying an Estate Tax until you pass on more than $1.5 million to your beloved progeny.Â If youâ€™re married, you donâ€™t even need to think about it until you pass on more than $3.0 million.
Donâ€™t believe me?Â Hereâ€™s what the IRSâ€™ own web site says on the subject.
â€œReminder: Most relatively simple estates (cash, publicly-traded securities, small amounts of other easily-valued assets, and no special deductions or elections, or jointly-held property) with a total value under $1,000,000 do not require the filing of an estate tax return.â€Â http://www.irs.gov/businesses/small/article/0,,id=108143,00.html
According to the â€œTax Policy Center,â€ a non-profit, non-partisan think-tank that assesses all things financially inevitable, since 1934 an average of less than 2%, and in the past decade, an average of less than 1.75%, of deaths have resulted in payment of the â€œEstate Tax.â€Â (http://www.taxpolicycenter.org/TaxFacts/estate/deaths.cfm)
Oh, by the wayâ€¦Â The average tax rate on estates that were taxed was 19%, not 49% as some in the repeal movement would claim.
Congress would have you believe that they are truly on your side in this one. Â Congress says it wants to eliminate the Estate Tax so all those poor family farmers and small business people out there can pass their farms and small businesses on to their kin-folk upon their death.Â After all, these folks sweated and toiled and fretted for years to build up their meager nest eggs so they could pass it on to their kids upon death.Â What right does Uncle Sam have to dip his hand into your pocket to snatch a death tax from your inheritance?!
â€œWhy itâ€™s the pinnacle of government heavy-handedness!Â This cash-grab by the government must be ended!â€
Not so fast, chief.
Letâ€™s flash back for a moment to those numbers at the top of the article.
Last year a whopping 75,000 Americans (deceased, I might add) paid about $20,000,000,000 in estate taxes.Â (I guess this means you really canâ€™t take it with you.)
As I mentioned earlier, thatâ€™s less than 1.75% of the people who died last year.
You gotta have a lot of money to get into that elite crowd, friends!Â I donâ€™t know about you, but Iâ€™m finding it hard to believe that this middle class schmoe will ever find his way into that club after putting three kids through college.
When 75,000 Americans get to throw their disproportionate weight around the halls of Congress you can bet thatâ€™s 75,000 Americans who have a LOT of financial clout.Â Some of these multi-millionaires are even sitting in the Congress.Â When you hear some congressman claim (as I did driving home yesterday) they are just trying to protect the farmers and small businessmen of the country you know they are, dare I speak bluntly, lying.
On this issue Congress is protecting the folks who fund their reelection; folks like Warren Buffet, Bill Gates, â€œThe Donald,â€ Steve Jobs, Michael Dell, Martha Steward, Steve Forbes, and most anyone else who has a big, fat silver spoon ready to hand down to their kids.Â The odds are that you, Mr. & Ms. NoMoreGreed reader, will never come close to paying an Estate Tax.
Hereâ€™s the bottom line, friends.Â Elimination of the so-called â€œDeath Taxâ€ is a double-edged sword.Â Its eradication will result in nothing less than unrestrained greed on the part of a very narrow, very privileged special interest group for whom financially privileged political clout is a way of life.Â If you are comfortable with the notion that the super-wealthy should be allowed to pass their billions on to their grand-children’s grand-children in perpetuity, creating a self-sustaining class of the uber-wealthy who can buy-and-sell influence and power for generations to come, then by all means, support elimination of the Estate Tax.
But, if you think that the uber-wealthy have a responsibility to shoulder a relatively fair portion of the cost of this society that has, after all, made them so doggoned uber-wealthy, then I suggest you pick up the phone, contact your congressional representatives, and let them know that elections in this country happen ever two years.