Current Events > ITT: You explain why inheritance/estate tax shouldn't be taxed at like 95%

(+) Yeah! (+)

AlephZero posted...

Nobody needs more than $10k in net worth. Any more than that should be seized by the government and redistributed to those of us unwilling to work.

If you're unwilling to work, you should get NOTHING!!!

No Work, No Food, No Anything.

Just because you exist, doesn't mean you deserve ANYTHING for free.

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Just because my family has money doesn't mean your family has the right to spend it. Tell your ancestors to apply themselves more.

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ChocoboMog123 posted...

Estate tax currently doesn't kick in until $11.4 million and excludes property, The rate goes from 18-40% as you approach $1 million taxable. For example, if your estate is $15 million in cash, you end up with $13.632 million, or an effective tax rate of 10%.

At what level can you reasonably give your children a wealthy life, for the rest of their lives? If you died when they were born, at what point would their financial situation change compared to if you had simply stopped earning when they were born?

Some number ITT are ridiculously low. 50k is probably a good point for a college fund, but not for a lifetime of income. $1 million is probably too low, especially passing down businesses, stocks, etc. $5 million is probably a good starting point (again, look at effective tax rate), which is roughly where it was before 2018 when it doubled.

This one.

The inheritance tax doesn't even kick in unless you are fairly rich. Quit whining about how those rich people are just having it so rough. They already are arguing for themselves enough they don't need poor people to get mad at other poor people on their behalf.
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TaZa92 posted...

What we're trying to solve here

Who's we? That's a YOU trying to force it on others issue.

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Caution999 posted...

The incredible amount of taxes are why we left England to begin with.

The problem wasn't taxation, it was taxation without representation.

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MrNintendo1213 posted...

ChocoboMog123 posted...

Estate tax currently doesn't kick in until $11.4 million and excludes property, The rate goes from 18-40% as you approach $1 million taxable. For example, if your estate is $15 million in cash, you end up with $13.632 million, or an effective tax rate of 10%.

At what level can you reasonably give your children a wealthy life, for the rest of their lives? If you died when they were born, at what point would their financial situation change compared to if you had simply stopped earning when they were born?

Some number ITT are ridiculously low. 50k is probably a good point for a college fund, but not for a lifetime of income. $1 million is probably too low, especially passing down businesses, stocks, etc. $5 million is probably a good starting point (again, look at effective tax rate), which is roughly where it was before 2018 when it doubled.

This one.

The inheritance tax doesn't even kick in unless you are fairly rich. Quit whining about how those rich people are just having it so rough. They already are arguing for themselves enough they don't need poor people to get mad at other poor people on their behalf.

.I mean, someone can disagree with the idea of something without materially benefitting from it.
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so what is the upper bracket for someone like a billionaire now? isn't it 50 perc.?

TaZa92 posted...

As a result, you have massive undeserved income inequality from the start.

So income inequality is alright if it's earned? Also why does Uncle Sam deserve it more than next of kin, what did he do to earn it? He has certainly proven to be not all that great with money.
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mustachedmystic posted...

The problem wasn't taxation, it was taxation without representation.

Well the dead don't get a say, and children can't vote, so in a way inheritance tax is explicitly taxation without representation.

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Esrac posted...

Sounds like the kind of logic someone who wouldn't ever inherit anything would use.

Regardless of my personal situation - don't you think it's unfair for those who start from nothing versus those who start with a lot with absolutely no doing of their own?

There are plenty of people who start off even way worse than I did so I'm not necessarily arguing for myself here.

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Tyranthraxus posted...

The real head scratcher is taxes on gifts. You can't just gift someone $15,000 for some reason. That's different from inheritance because I'm giving that money up while I'm still alive to use it.

Not sure if you knew, but $15,000 is exactly the amount you can "just gift someone." You may do so once per tax year, up to $11.4 million total.

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s0nicfan posted...

mustachedmystic posted...

The problem wasn't taxation, it was taxation without representation.

Well the dead don't get a say, and children can't vote, so in a way inheritance tax is explicitly taxation without representation.

Ehh, I mean, so would taxing teens younger than 18 if we use that logic
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TaZa92 posted...

Regardless of my personal situation - don't you think it's unfair for those who start from nothing versus those who start with a lot with absolutely no doing of their own?

There are plenty of people who start off even way worse than I did so I'm not necessarily arguing for myself here.

Some people are born "Prettier/Handsomer" than others.

Some are born with more Athletic talent.

Some are born Smarter.

Some are born Luckier.

Are you going to try to fix that too?

Life is meant to be unfair.

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95 perc. is too high, but it should be higher than the 50 perc. it currently is for billionaires iirc

KamenRiderBlade posted...

Some people are born "Prettier/Handsomer" than others.

Some are born with more Athletic talent.

Some are born Smarter.

Some are born Luckier.

Are you going to try to fix that too?

Life is meant to be unfair.

We can fix that...
https://en.m.wikipedia.org/wiki/Harrison_Bergeron

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TaZa92 posted...

Regardless of my personal situation - don't you think it's unfair for those who start from nothing versus those who start with a lot with absolutely no doing of their own?

There are plenty of people who start off even way worse than I did so I'm not necessarily arguing for myself here.

No, it isn't unfair if one person's parents earned more money and thus have more to leave to their children.

It is inequitable, but equity is not the same thing as fairness.

voldothegr8 posted...

So income inequality is alright if it's earned? Also why does Uncle Sam deserve it more than next of kin, what did he do to earn it? He has certainly proven to be not all that great with money.

I think to an extent - yes. If you are able to do well for yourself and earn a higher income relative to your peers, that makes sense. That's the whole reason money exists, to provide an incentive for yourself.

And hey I agree with you, maybe we need to make sure the government manages their budget better before implementing such a tax. I was referring more to the principle of the matter.

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s0nicfan posted...

We can fix that...
https://en.m.wikipedia.org/wiki/Harrison_Bergeron

That's just a stupid piece of Dystopian fiction.

Not a good way to live life.

Just accept what you were born with and work on improving yourself.

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KamenRiderBlade posted...

That's just a stupid piece of Dystopian fiction.

Not a good way to live life.

Just accept what you were born with and work on improving yourself.

I was being sarcastic. It being a piece of dystopian fiction that looks at what a completely equal society would look like is the point.

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TaZa92 posted...

And hey I agree with you, maybe we need to make sure the government manages their budget better before implementing such a tax. I was referring more to the principle of the matter.

Maybe you should prevent Government Officials from being Wasteful of money.

https://losangeles.cbslocal.com/2018/01/16/goldstein-investigation-10-million-lapd-electric-bmws-appear-unused-misused/

Here's the Los Angeles Mayor wasting $10 million on Electric Vehicles the police won't use because it doesn't suit their needs. The Mayor just willy nilly bought these to look "Green" for his constituents.

Nobody is crucifying Eric Garcetti for this.

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KamenRiderBlade posted...

Some people are born "Prettier/Handsomer" than others.

Some are born with more Athletic talent.

Some are born Smarter.

Some are born Luckier.

Are you going to try to fix that too?

Life is meant to be unfair.

You are right that there will always be an inherent unfairness in life. The thing is just because there are certain genetics differences that provide people with advantages, that doesn't mean you can argue against leveling the playing field for completely unearned income.

Genetics is subjective in nature, while inheritance income is objective and measurable. The main thing, though, is how we should focus on rewarding those who help further society with their skills/hard work. So if someone is genetically a "genius" and they develop theories or make ground breaking discoveries that changes all of our lives for the better, they deserve to be reward.

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By TC's logic, my childhood home that I inherited, which I did without a lot of luxuries or halfway quality food so the mortgage could be paid, and is the only way I would have been able to afford a home, would either be seized by or sold to the government unless I could come up with over $150,000 in cash on my (at the time) $30,000 a year salary.

Not everyone is so liquid they can afford cash taxes on non liquid assets, and people that don't really qualify as rich can still have property to pass on, so unless you really just want government seizure of assets, your idea is crap because a lot of tax bills would go unpaid.

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KamenRiderBlade posted...

Maybe you should prevent Government Officials from being Wasteful of money.

https://losangeles.cbslocal.com/2018/01/16/goldstein-investigation-10-million-lapd-electric-bmws-appear-unused-misused/

Here's the Los Angeles Mayor wasting $10 million on Electric Vehicles the police won't use because it doesn't suit their needs. The Mayor just willy nilly bought these to look "Green" for his constituents.

Nobody is crucifying Eric Garcetti for this.

Okay, then what if we simply lowered income tax for those under a certain amount (say 500k a year?) and make up the difference through inheritance tax.

Assume that this would be done in a way the government will have the same amount money at their expense. What would be your argument in that scenario?

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TaZa92 posted...

Genetics is subjective in nature, while inheritance income is objective and measurable. The main thing, though, is how we should focus on rewarding those who help further society with their skills/hard work. So if someone is genetically a "genius" and they develop theories or make ground breaking discoveries that changes all of our lives for the better, they deserve to be reward.

We already do have systems of reward for doing that. It exists already. If you make a ground breaking discovery and make products that better our lives, your company will be rewarded.

Look at the PC industry and how it started.

Look at the start of Apple / MS.

They LITERALLY changed the world several times over and were handsomely rewarded for it.

Look at the Automobile industry and how it started.

They're rewarded as well.

Same with Aircraft.

Same with Boats.

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lightwarrior78 posted...

By TC's logic, my childhood home that I inherited, which I did without a lot of luxuries or halfway quality food so the mortgage could be paid, and is the only way I would have been able to afford a home, would either be seized by or sold to the government unless I could come up with over $150,000 in cash on my (at the time) $30,000 a year salary.

Not everyone is so liquid they can afford cash taxes on non liquid assets, and people that don't really qualify as rich can still have property to pass on, so unless you really just want government seizure of assets, your idea is crap because a lot of tax bills would go unpaid.

I was being overtly extreme in my topic title to get more attention tbh. There would be an obvious minimum amount prior to the tax kicking in.


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I like it but only if all the money is funneled into a party

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Unsugarized_Foo posted...

I like it but only if all the money is funneled into a party

That's called CORRUPTION.

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KamenRiderBlade posted...

We already do have systems of reward for doing that. It exists already. If you make a ground breaking discovery and make products that better our lives, your company will be rewarded.

Look at the PC industry and how it started.

Look at the start of Apple / MS.

They LITERALLY changed the world several times over and were handsomely rewarded for it.

Look at the Automobile industry and how it started.

They're rewarded as well.

Same with Aircraft.

Same with Boats.

Right, that's exactly what I was saying when you brought up your point about genetic differences resulting in some people having more success than others. I argued that yes, it's inherently "unfair", but the payoff to society is greater and they're being rewarded so there's no reason to try to somehow level THAT playing field. Especially because of it's subjectivity in nature.

I used that as a point to prove the logic of my actual argument is that people shouldn't be handed money to start without earning it. They are NOT inherently providing benefits to society in that manner, and on top of that it only furthers income inequality from the start.

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Unsugarized_Foo posted...

I like it but only if all the money is funneled into a party

This guy is onto something

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ChocoboMog123 posted...

Not sure if you knew, but $15,000 is exactly the amount you can "just gift someone." You may do so once per tax year, up to $11.4 million total.

I thought $15,000 is when it started getting taxed.

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Esrac posted...

No, it isn't unfair if one person's parents earned more money and thus have more to leave to their children.

It is inequitable, but equity is not the same thing as fairness.

From the perspective of the children, there is a large difference between them in terms of money they were given without any doing of their own. That's something that is measurable and we can actually target.

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TaZa92 posted...

I used that as a point to prove the logic of my actual argument is that people shouldn't be handed money to start without earning it. They are NOT inherently providing benefits to society in that manner, and on top of that it only furthers income inequality from the start.

But you're also fighting against human nature of providing a better life for their child, and that inherently means handing over wealth from generation to generation.

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TaZa92 posted...

but inheritance is probably the biggest reason for major income inequality with no real justification for the person receiving the income.

this keeps getting repeated....but I need some proof of this. Plenty of rich folks have blown all their money and plenty have not. Plenty of poor people are poor due to terrible life circumstances(both luck of the draw and decisions made) but many are poor because they have 0 concept of money management

And the argument that they don't work for their wealth because inheritance is BS. Plenty have used their wealth wisely, just because the left hates the rich doesn't make the rich all evil. Sure some of them suck, but that's not an excuse to tax the rich to death either.

Caution999 posted...

We are already taxed plenty enough as it is for inheritance depending on your state.

Enough is enough. The incredible amount of taxes are why we left England to begin with.

next of kin gets the majority of property unless a will determines otherwise. There is already a fair inheritance tax; and in some states its already exorbitant.

also this. The tax code is beyond absurd at this point. We are taxed to death. I'm shocked there isn't a tax on oxygen at this point.

on top of that simple old fashioned idea of....."My grandfather worked on a farm, my father inherited the farm from him, and now I inherit the farm from my father" concept gets killed by people like TC.

No one else has any entitlement to that money, especially people who want higher taxes.

KamenRiderBlade posted...

That's called CORRUPTION.

Yeah, of my LIVER

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KamenRiderBlade posted...

But you're also fighting against human nature of providing a better life for their child, and that inherently means handing over wealth from generation to generation.

Yeah, and that's the best argument against the whole thing imo. My logic was that you would still be providing for your child and giving them better opportunities as they are growing. You'll also still want to work hard to make sure your retirement is the best possible retirement it could be which I think is very important for a lot of people.


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Unsugarized_Foo posted...

Yeah, of my LIVER

You can corrupt your liver on the alcohol that you paid with your own money.

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kayoticdreamz posted...

this keeps getting repeated....but I need some proof of this. Plenty of rich folks have blown all their money and plenty have not. Plenty of poor people are poor due to terrible life circumstances(both luck of the draw and decisions made) but many are poor because they have 0 concept of money management

And the argument that they don't work for their wealth because inheritance is BS. Plenty have used their wealth wisely, just because the left hates the rich doesn't make the rich all evil. Sure some of them suck, but that's not an excuse to tax the rich to death either.

also this. The tax code is beyond absurd at this point. We are taxed to death. I'm shocked there isn't a tax on oxygen at this point.

on top of that simple old fashioned idea of....."My grandfather worked on a farm, my father inherited the farm from him, and now I inherit the farm from my father" concept gets killed by people like TC.

I'll try to address as many of the points as I can:

1. No one said rich people are evil. Rich people have done incredible things for society and tend to get a bad rap due to some bad eggs that overshadowed them.
2. Yes, some rich children do great things with the wealth they are given. That doesn't mean they all do and it doesn't mean they necessarily deserve wealth they did not earn. It still gives them an objectively measurable advantage to their equivalently "intelligent" (for lack of a better word) peers who did not receive that sort of inheritance. The argument you would want to make here is if the the rich children who do very well with their inherited wealth for society somehow trumps what could be done for society via the taxes earned on inheritance as a whole.
3. Taxes can definitely get ridiculous, especially on earned income. On unearned income it's fair game.
4. There would be a minimum amount prior to the tax being implemented. Also certain small businesses would probably be excluded to allow for children and grandchildren who want to further their family business (like the farm example you gave).

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inTaCtfuL posted...

so what happens if i don't have any children iyo

Only the person you gave the money to is taxed. Not you

voldothegr8 posted...

So basically you're salty af from envy

[LFAQs-redacted-quote]


Come on guys don't e-bully me :(

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I think what should be fixed is how things like equities/stock and property are taxed after death. example, if someone bought $50,000 Amazon stock at an average of $100 per share several years ago and just died, the person who inherits the stock is only taxed on profits based the price of the stock of the day they inherited it. This means about $975,000 (AMZN is ~$1950 per share now) would not be taxed under current laws. This same thing applies to property values.

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It's too easy to work around. You literally just need to have your assets in cash or other physical possessions and then leave them to family in a non direct way.

They totally should be taxed to an extreme though. Money should return to the people instead of sitting in the coffers of the rich for generations.

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I'm generally in favor of inheritance taxes but some counter points

1. They're very easy to dodge.
2. Something tells me 95% is above the revenue-maximizing rate...
3. It transfers wealth that may otherwise be invested.
4. It should be progressive like all taxation. The financial security of children is actually a massive economic incentive and there's no reason to remove that.

TaZa92 posted...

Spoiler alert: you can't

Yes, everyone has the right to their own money they've (possibly) worked hard for. They have to right to use that money to give their children the best lives possible while they are growing up, but once they're adults it's over tbh. Throws off the whole playing field.

Edit - let me clarify if my double negative in the topic title was confusing: inheritance should be massively taxed.

Im envious of people that were left a bunch of money and have it easier than I do!

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rexcrk posted...

Im envious of people that were left a bunch of money and have it easier than I do!

There's nothing wrong with wanting people to earn what they have.

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Nu_Titan posted...

I think what should be fixed is how things like equities/stock and property are taxed after death. example, if someone bought $50,000 worth of Amazon stock at an average of $100 per share several years ago and just died, the person who inherits the stock is only taxed on profits based on price of the stock of the day they inherited it. This means about $975,000 (AMZN is ~$1950 per share now) would not be taxed under current laws. This same thing applies to property values.

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Relient_K posted...

It's too easy to work around. You literally just need to have your assets in cash or other physical possessions and then leave them to family in a non direct way.

They totally should be taxed to an extreme though. Money should return to the people instead of sitting in the coffers of the rich for generations.

Yeah - if you aren't the original purchaser of a product then the tax should be higher than simply only paying for the "profit" amount. Technically the entire amount was a profit for you.

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Tyranthraxus posted...

There's nothing wrong with wanting people to earn what they have.

That's all good and well, but how did the people who will be recipients of the money in TC's scenario earn it?

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Broseph_Stalin posted...

I'm generally in favor of inheritance taxes but some counter points

1. They're very easy to dodge.
2. Something tells me 95% is above the revenue-maximizing rate...
3. It transfers wealth that may otherwise be invested.
4. It should be progressive like all taxation. The financial security of children is actually a massive economic incentive and there's no reason to remove that.

Good point - but as technology continues to improve it'll become easier to track where money is moved. If it's moved to assets, those assets need to be taxed higher otherwise it'll be a huge loophole.

Also yes it should be more progressive, I wasn't serious when I mentioned 95% on all inheritance. You're still allowed to provide for your kids obviously as they are growing. They'll have better opportunities regardless on average the weathier you are and there will be a minimum amount they can inherit prior to taxation.

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s0nicfan posted...

That's all good and well, but how did the people who will be recipients of the money in TC's scenario earn it?

It would go back into society as a whole through government programs. Maybe it'll be able to provide for healthcare for all or something of that sort.

If you want to argue that even higher taxes are not fair, I'll bring up an earlier point: what if we lowered income tax for those making less than $500,000 a year and made up for it with inheritance tax?

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