Posted on 12/11/2012 6:29:48 PM PST by george76
New legislation that jumps the death tax to 55 percent of estates exceeding $1 million threatens 526,421 family farms, of about 25 percent of all farms in America.
...
Farm values are largely tied up in non-liquid assets like land, buildings, and livestock. Many farm and ranch families would be forced to sell their assets to satisfy Washington Democrats' insatiable appetite for tax money. Up to 24 percent of America's farm and ranch families could be forced to hand over a large chunk of their heritage to the Internal Revenue Service when a family member dies. This would economically devastate rural communities
(Excerpt) Read more at washingtonexaminer.com ...
BUMP!!!!!!!!!!!!!!!!!!!!!!!
Did you ever try to make installment payments on half a million dollars?
Otherwise you need to stick to places like Yosemite Valley where the huddled masses wait their turns in traffic jams on the roads and trails for the perfect picture of a trickling waterfall under a smoggy sky.
Why don’t these families incorporate their farms? Wouldn’t that allow them to keep the farm going from generation to generation without having to pay a death tax?
The elephant in the room here nobody seems to understand is once these farms are gone and/or the current generation of farmers/ranchers are gone with no replacements food prices will skyrocket. ConAgra, Del Monte, and the other huge operations will control the food supply of this nation with no option for us to fall back on.
Not to mention the destruction of our seed crops by genetic mutation and pollution of our products like milk by forcing producers to use potent antibiotics and other means to try and remain profitable.
The high taxes, cost of implements, over regulation, and land make it impossible for anyone who does not inherit land and is already wealthy to go into agricultural in no position above small operator. Most big parcels of land are now bought by the wealthy and sit idle or for use as dude ranches, bastions of solitude and such.
True ranchers and farmers loved the land and way of life and did so no expecting to ever get rich, only be able to hold their land and pass on their lifestyles.
Never heard of that. Don't believe it is true.
Not entirely true. Here is Texas yes, there is not much public land and 99% of hunting is on private high $$ ranches or family lands.
There is plenty of access to public land in the Rocky Mountain states. I hunt there almost every year. The problem is the government designating some as wilderness areas (which I am not opposed to) but that closes lots of land off and forces hunters to other public lands.
Ranchers in areas that are not “famously prime” or sleeper areas are sometimes willing to let you cross their land and even hunt on them, especially varmints and rodents. BLM lands also have plenty of access as by law the lessee cannot keep you off it.
Because someone has to own the corporation, and when they die the value of to portion of the corporation that they own is subject to the estate tax.
Agenda 21...google it. Adios farm owners....they have a plan for you.
Incorporation? That’s exactly what’s done in the People’s Republic of Maryland to avoid the taxes on the transfer of real estate.
Incorporate, contribute your home in exchange for stock, sell the home through a sale of the stock and avoid the real estate transfer fees!
Wrong, a Trust only protects you from having the state probate your estate and keeps it from public view. It saves you the 15% probate fee the court will access if you die intestate. Other than that, you are still subject to state and federal laws concerning taxation of estate. Depending on the trust, it can help you when you are still alive and in some situations make you law suit proof. A trust is a good thing if you have assetts, but not if you don’t
Even this is not enough of a benefit for businesses, so they arrange these mildly complicated deals so that they can transfer properties from one company to another without it being classified as a sale.
There are business properties in California that have changed hands several times that are still paying taxes near the original rates when Prop 13 was put into law.
Of course I'm supposed to be OK with anyone who can legally avoid paying taxes. I'm just wondering why farmers, who tend to be among the wisest (bookwise and streetwise) haven't figured this out yet.
This is why 40 years ago when land prices went up in Iowa, many families incorporated their farms. At that time, many heirs were forced to sell their farms to pay the inheritance taxes, so the smart ones turned their farms into corporations controlled by the families. This problem now is because Americans have a short memory, and have not thought about what would happen if their holdings exceed the government’s definition of “rich”.
this is basically zimbabwe through death taxes. obama freaking loves it.
Hopefully I will never have to. The NPR anchors heard that from some leftist they were interviewing and decided everything was ok.
Estates over $1 million will be taxed at 55%.
MANY congressmen/senators have estates over $1 million.
Find out how they legally avoid this penalty and do the same.
They always write escape routes into punative laws for themselves.
Land based assets are the toughest to pass down!
until 12/31/12 an estate value up to 10.2 mill can be gifted down to family members of two living parents. then it reverts to 2.1 mil. on 01/01/13. Who knows what congress will do in the future. In any case, it will trigger a reassessment for property taxes immediately if this exceeds 50% value of the land holdings. There are discounts for the actively farmed land itself but any other unsecured assets (think homes and even potential homesites) get bumped up! I have three sibling that work this farm with me. Dad has passed and mom may outlive us all. I’m almost 60 and still paying on dads estate taxes because only the 1 mill was available to him at the time. ROI’s are quite small in farming and spread 4 ways + mom makes for a challenge in bad years. We built this farm as a family living quite frugally but land values have increased faster than any amount of estate planning could keep up with. It is all a paper asset. we could certainly borrow against the asset but you have to service that debt and there is rarely enough to buy a toy that does not pay for itself. Land assets are not like any other capital purchases. There is no depreciation, in fact the opposite is likely true. A full appraisal must be preformed every time for any gifting to occur. Gifting to my kids is great but my wife and I need to retain some assets for our income. (Yes I know about A/B trusts) Any family that does not start estate planning from day one will eventually lose the farm to pay the taxes.
“Incorporate, contribute your home in exchange for stock...”
And what happens when the government declares that all corporations are now owned by the “People” due to the “current crisis.” It could happen. That incorporated home would be taken.
Now that Calif Dems have a Super Majority in the legislature—look for Prop 13 to be dismantled.
Jerry Brown and others in the legislature hate Prop 13 because it keeps them from raising property taxes over and over again.
I expect a new wave of people leaving Calif once and for all.
How will we be dependent upon the government for our food, if there are farms everywhere?
Socialism has consequences.. it is called Communism.
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