Posted on 11/14/2007 10:48:28 AM PST by Sub-Driver
Warren Buffett: Tax inherited estates
By LAURIE KELLMAN, Associated Press Writer 11 minutes ago
Billionaire Warren Buffett told the Senate Finance Committee on Wednesday that Congress should keep the estate tax rather than repeal it and help a few rich Americans like him.
"I think we need to ... take a little more out of the hides of guys like me," Buffett told the panel.
One of the world's richest men and biggest philanthropists, Buffett has been outspoken against efforts, mostly by Republicans, to repeal or reduce the federal tax on inheritances. Democrats argue that a repeal would amount to a huge windfall for the nation's wealthiest families.
The fate of the levy will effectively be decided during next year's presidential and congressional elections.
Estates worth up to $2 million this year and next will be exempt from the federal estate tax. Portions of estates above that threshold will be taxed at 45 percent.
In 2009, the exemption level rises to $3.5 million, and by 2010 the estate tax will be repealed — but only for a year.
Unless Congress changes the law, it comes roaring back in 2011 with an exemption threshold of only $1 million and a top tax rate of 55 percent.
Buffett said inheritance taxes preserve a measure of meritocracy, and with it opportunity, by recycling portions of great wealth through public coffers.
"The resources of society I don't think should pass along in terms of an aristocratic dynasty of wealth," Buffett told the panel. "I believe in keeping equality of opportunity as much as you can in this country."
(Excerpt) Read more at news.yahoo.com ...
(Just because he hates his kids...)
Milton Friedman already explained why the estate tax is a terrible, terrible idea. Older people will have a strong incentive to spend money like it’s going out of style rather than leaving it to the government. It encourages luxury consumption at the expense of long term investment.
If you know that Uncle Sam’s going to take the house or business when you die, you mortgage ‘em to the hilt and go on world cruises, take the grandkids to Disneyland, you get the picture. If your kids are gonna get the assets, you try to pass on as much as you can, at least there’s some incentive not to take out a reverse mortgage, aka, the U-Haul on the back of the hearse.
Warren Buffet is a very poor judge of human nature, imho. He's a sourpuss who wants his grandkids to "benefit" from having to make it on their own and not get too used to luxury. Isn't he just so grand? Most people want the grandkids or kids to get the house.
I remember Warren Buffett advising Arnold to raise the California property tax, needless to say that was the last Arnold’s campaign was aligned with Buffett. There seems to be a malady with some of the Super Rich where they try to buy their souls back as though the are guilty of a crime and not just successful.
Hey in an age where the $100 is the new $20 I say to Mr. Buffet - “Go ahead and give your dough to the Feds, leave mine alone”. OBTW look out for a lot of old folks dying mysteriously in Dec 2010. Gives new meaning to the term “deadline”.
I repeat, More taxes will be paid by getting rid of the inheritance tax as property will no longer get an increased basis through the estate. Watch the kids scream then.............. But it would most likely be a cheap 15% cap gain taxes (assuming the rats don't really screw things up)
Of course they can avoid the tax by continuing the business but that does’nt get them a new car.
There are already exemptions for passing on family owned business such as farms. This is a very emotional issue that gets used by many people.
Get the facts:
1) very few people pay the inheritance tax just like very few people paid taxes on the gain from the sale of the house so they finally got rid of the tax for the most part.
2) TAX REVENUE GOES UP without it (the unspoken truth that no one wants to talk about)
Personally, I say get rid of the Inhertiance tax, it makes our life simple and is one less intrusion in our lives. Unfortunately, the state inheritance taxes are worse than the federal taxes and the tax doesn't go away, it just changes form
See the link at post 20. Buffett makes money - lots of it - on the death tax.
Thank you. You have a very interesting home page, which I will explore at a later time. Good analogy between S. Korea and Iraq, especially now with another cut and run bill in congress!
Name someone who inherited great wealth, and then had a great life.
I think that raising the estate-tax exemption to 15 or 20 million dollars, indexed for inflation, might be OK.
I’m glad you’re not in favor of the inheritance tax. Just keep in mind that when it hits people who WANT to keep running the company (like Zacky Farms here in Fresno), the kids may be forced into selling to pay the taxes, and guess who’s waiting to buy up the assets at fire sale prices?
Worth repeating:
HOW IS IT A "WINDFALL" IF IT WAS YOUR'S IN THE FIRST PLACE YOU IDIOTS?!!!!!!!!!!!!!
Hear, hear!!
I mean; here, here!!
“I think we need to ... take a little more out of the hides of guys like me,” Buffett told the panel.
Note to Warren: You may be rich, but you are a bit nutty. If you feel guilty about being so rich, donate all of that money to whomever/whatever you wish - The U.S. Government, the Salvation Army, the U.N., or the local university. But, please - leave the rest of us alone!!!
Makes perfect sense.
Increased property taxes, allied with increases in payments on shakey ARMS equals more and faster defaults for he and his buddies to leech from.
There seems to be a malady with some of the Super Rich where they try to buy their souls back as though the are guilty of a crime and not just successful.
"Atonement" has nothing to do with it; creating more misery for others in order to feed their own coffers is what it is all about.
If he and those like him, "want" to pay $1,000,000 more in taxes, it is only because it will net them $10,000,000 more in income.
“He wants to keep things as is because money that is spent on life insurance flows to him, and life insurance benefits are tax free. It’s naked self interest, as National Review Online explained today.”
A relative was sold life insurance with a very large annual premium for this reason. The relative was protecting the heirs inheritance but the lawyer and insurance company got the immediate gain and years later, thanks to Republicans, it wasn’t necessary after all.I always thought it was a racket and your comment about Buffet brings it into clarity for me.
There is no reason Buffett couldn’t send the IRS more money, they would take it.
The left hates it when normal people pile up some money and leave it to their kids. They want to be the only rich ones and control everything.
It seems that someone has to pay taxes.
Dead people mind it the least.
Is everyone suggesting that our income tax be raised so that billionaires can pass on their wealth? Probably not.
I’m OK with abolishing the inheritance tax, right after the income tax is abolished. Until then, I think that raising the inheritance tax exemption to at least $10 million, and preferably higher, would be a good idea.
There are ways to avoid inheritance tax. There is enough equity in the inheritance to borrow to pay it if they choose to pay it. This is just an excuse to sell the the business that most kids don’t want to run anyway. The tax is not the WHOLE inheritance. With the inheritance basis increased, they certainly have a BIG depreciation deduction to offset income tax. Some farmsteads in Iowa have been depreciated 3 or 4 times.
If there is no inheritance tax then they defer taxes by not selling the business.
In the case you have referred to, state inheritance taxes that are more of a problem than federal. Along with other onerous regulations. If there is a fire sale because the kids CHOSE cash over business and memories, hopefully it is you and I that are buying.
A lot of rich people got to be rich by cheating. The older they get, the more that catches up with them, and they start trying to compensate.
Witness both Gates and Buffett. They even play bridge together.
That’s the thing with liberals - the ends justify the means, until, of course, they’re at the end themselves.
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