On Jan. 1, 2013, the estate tax is set to climb to as high as 55
percent — among the highest in the world economy — with
the exclusion rate dropping to just $1 million, making 2013 a bad year
to die for small businesses owners and the wealthy.
The estate tax — often called the death tax — had been on the decline due to the Bush tax cuts, even reaching zero in 2010. Since then, it has risen back to 35 percent, with an $5 million exclusion, where it remains today.
As blogged by conservative organization Americans for Tax Reform (ATR), research by the Urban Institute and Brooking Institution’s Tax Policy Center says that “if the current death tax expires, then the resulting, stricter exemption threshold will force 114,600 estates to file for the tax in 2013 — this represents a 13-fold increase from the previous year’s 8,800 estates, and countless wasted hours filling out tax paperwork. Of that cohort, an unfortunate 52,500 will be liable for the tax, way up from 3,300.”
While the tax would only affect 2 percent of the American population, ATR points out that its impact is far broader, is “it causes many wealthy individuals to save less, choosing instead to retire early or, as Milton Friedman put it, ‘dissipate their wealth on high living.’”
“This reduction in savings,” the report continues, ”means a concomitant reduction in investment, lessening the flow of capital to businesses and organizations where countless ordinary Americans are employed.”
The estate tax has been under assault over the past year. Most recently, a coalition of non-profit groups and conservative Republican lawmakers has pushed for permanently repealing the estate tax — and putting politicians of both parties on the record as to whether they support full repeal.
There are 217 co-sponsors for a bill to end the estate tax in Congress, with a 218th, The Daily Caller has learned, expected soon. Republican leadership, however, has appeared hesitant.
Read more: http://dailycaller.com/2012/07/20/potential-death-tax-increase-makes-2013-a-very-bad-year-to-die/#ixzz219cgeBpU
The estate tax — often called the death tax — had been on the decline due to the Bush tax cuts, even reaching zero in 2010. Since then, it has risen back to 35 percent, with an $5 million exclusion, where it remains today.
As blogged by conservative organization Americans for Tax Reform (ATR), research by the Urban Institute and Brooking Institution’s Tax Policy Center says that “if the current death tax expires, then the resulting, stricter exemption threshold will force 114,600 estates to file for the tax in 2013 — this represents a 13-fold increase from the previous year’s 8,800 estates, and countless wasted hours filling out tax paperwork. Of that cohort, an unfortunate 52,500 will be liable for the tax, way up from 3,300.”
While the tax would only affect 2 percent of the American population, ATR points out that its impact is far broader, is “it causes many wealthy individuals to save less, choosing instead to retire early or, as Milton Friedman put it, ‘dissipate their wealth on high living.’”
“This reduction in savings,” the report continues, ”means a concomitant reduction in investment, lessening the flow of capital to businesses and organizations where countless ordinary Americans are employed.”
The estate tax has been under assault over the past year. Most recently, a coalition of non-profit groups and conservative Republican lawmakers has pushed for permanently repealing the estate tax — and putting politicians of both parties on the record as to whether they support full repeal.
There are 217 co-sponsors for a bill to end the estate tax in Congress, with a 218th, The Daily Caller has learned, expected soon. Republican leadership, however, has appeared hesitant.
Read more: http://dailycaller.com/2012/07/20/potential-death-tax-increase-makes-2013-a-very-bad-year-to-die/#ixzz219cgeBpU
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