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re: I don't understand inheritance tax
Posted on 1/19/16 at 9:26 am to yellowfin
Posted on 1/19/16 at 9:26 am to yellowfin
quote:
a fresh $20 bill
I guess you don't know what it costs to get several commercial real estate appraisals. That would cost me around $5,000 just to get you to send me a "fresh $20 bill." Yeah.......NO.
This post was edited on 1/19/16 at 9:30 am
1
Posted on 1/19/16 at 9:26 am to mailman
Don't worry about it. You aren't rich enough to be affected. Let the rich folk fight it.
Posted on 1/19/16 at 9:28 am to mailman
In New Jersey, we have both a state inheritance tax and estate tax. However, you only pay the higher amount. Money passed up or down the family line is not subject to inheritance tax. Additionally, money left to charities are not subject to the inheritance tax. In regards to the inheritance tax rate, anything left to other family members (e.g. brothers, sisters) is taxed from 11-16% excluding the first $25,000. Other beneficiaries (e.g. friends) are taxed at 15% for the first $700,000 and 16% for over that amount.
The estate tax ranges from 4.8% - 16%, with a $675,000 exemption.
The estate tax ranges from 4.8% - 16%, with a $675,000 exemption.
Posted on 1/19/16 at 9:28 am to LSURussian
That's what I figured
Posted on 1/19/16 at 9:31 am to yellowfin
Where is my chair....oh, here it is.
Posted on 1/19/16 at 9:32 am to yellowfin
You figured wrong.
See my edit above.
See my edit above.
Posted on 1/19/16 at 9:37 am to LSURussian
you asked if I wanted to bet and now you're backing out
you can just post proof of ownership and we'll call it a win for you
you can just post proof of ownership and we'll call it a win for you
Posted on 1/19/16 at 9:48 am to yellowfin
quote:
you asked if I wanted to bet and now you're backing out
you can just post proof of ownership and we'll call it a win for you
You really can't be serious that $20 is a bet that would make it worth my costs to gather the value of my estate's assets.
If that's all you can afford, sorry to hear you're poor so I'll let you walk away believing you won just so you can feel better about yourself.
Posted on 1/19/16 at 9:49 am to mailman
I will never understand inheritance tax and there is nothing that can be said that can explain it
Those funds have been taxed numerous times by the people who earned them. You should be able to leave any amount to your family and the government should not be able to tax one red cent of it.
It is pure insanity.
Those funds have been taxed numerous times by the people who earned them. You should be able to leave any amount to your family and the government should not be able to tax one red cent of it.
It is pure insanity.
Posted on 1/19/16 at 9:53 am to LSURussian
I actually do feel much better, thanks for that
I'll let you slide on the $20 you owe me, maybe you can get lunch one day
I'll let you slide on the $20 you owe me, maybe you can get lunch one day
Posted on 1/19/16 at 9:56 am to LanierSpots
quote:Technically not true. Most estate assets have appreciated in value since they were first acquired.
Those funds have been taxed numerous times by the people who earned them.
So, in effect, only the original funds used to buy the asset were after tax dollars. The unrealized profits on the assets have never been taxed...YET.
What I would like to see is that when someone dies if he leaves the estate to his direct heirs, they assume the deceased person's cost basis and only would pay capital gains tax whenever they sell they assets just as if the dead person had sold the assets while alive.
Posted on 1/19/16 at 9:57 am to yellowfin
quote:You're welcome.
I actually do feel much better, thanks for that
Posted on 1/19/16 at 9:58 am to LSURussian
quote:wouldn't that just compound the problem of the wealth never changing hands?
What I would like to see is that when someone dies if he leaves the estate to his direct heirs, they assume the deceased person's cost basis and only would pay capital gains tax whenever they sell they assets just as if the dead person had sold the assets while alive.
part of the reason we have inheritance taxes is to prevent old-world-style aristocracy
(I don't really have much of my own opinion on estate taxes, as it'll probably never be my problem)
This post was edited on 1/19/16 at 9:59 am
Posted on 1/19/16 at 10:00 am to mailman
quote:
I don't understand stand why money should be taxed if it's transferred between two people and the point of raising the tax.
The economic theory is that the money is sitting idle and not contributing to the growth of the economy. You being idle rich does no good for anyone else. The tax therefore encourages you to do other things with your money such as invest or create trusts, etc.
In reality, the government has an insatiable appetite for taxation income. More is never enough. And it cannot tax money that does not move. So it has decided to grab a piece of the pie as it moves to your heirs.
Posted on 1/19/16 at 10:02 am to baytiger
It is extremely rare for wealth to last over 3 generations in a family.
The grandkids have no clue how to make it, then squander it and sell grandpaws farm. Or whatever is left.
Inheritance tax is just communism.
The grandkids have no clue how to make it, then squander it and sell grandpaws farm. Or whatever is left.
Inheritance tax is just communism.
Posted on 1/19/16 at 10:03 am to baytiger
quote:Only if you think that's a problem.
wouldn't that just compound the problem of the wealth never changing hands?
quote:Or, to put it another way, "YOU DIDN'T BUILD THAT!!" -Barack Obama, July 13, 2012.
part of the reason we have inheritance taxes is to prevent old-world-style aristocracy
It's a Class Warfare Tax.
This post was edited on 1/19/16 at 10:07 am
Posted on 1/19/16 at 10:03 am to LSURussian
quote:
What I would like to see is that when someone dies if he leaves the estate to his direct heirs, they assume the deceased person's cost basis and only would pay capital gains tax whenever they sell they assets just as if the dead person had sold the assets while alive.
ETA: I completely misread your post. I thought you were advocating for a step-up in cost basis for everyone and elimination of the inheritance tax. That would be illogical.
You're much more likely to see the opposite happen, and I'm not sure there is really anything wrong with that.
I'm not a huge fan of the step-up in cost basis from a logical standpoint - why should your grandfather owe long-term capital gains on $3M in profit in Exxon Mobil stock the day before he dies, yet you, as an heir, owe nothing in LTCG the day after he dies?
I know advocating for taxes is risky business on the OT, but if you're going to have them, that seems much more logical than the cost basis step up. I understand it may not be as practical since older record keeping may be lacking, but going forward it shouldn't be an issue with new generations.
This post was edited on 1/19/16 at 10:11 am
Posted on 1/19/16 at 10:04 am to mailman
quote:
I don't understand inheritance tax
While you are thinking about this you may want to REALLY mess your mind up by throwing in all the other taxes .... local, state, and esp. fed. Combine that with cleverly disguised taxes such as the most recent that I am aware of, obamacare. Some taxes are even more hidden such as one that goes to fire protection. It's in every homeowner's policy.
Some are good and sensable while some are downright theft. The sum total is ridiculous. We have become a socialist country but the thing that pisses me off most is only about 50% of us are contributing to the most important of those taxes,
[/rant)
Posted on 1/19/16 at 10:04 am to LSURussian
quote:
Technically not true. Most estate assets have appreciated in value since they were first acquired. So, in effect, only the original funds used to buy the asset were after tax dollars. The unrealized profits on the assets have never been taxed...YET. What I would like to see is that when someone dies if he leaves the estate to his direct heirs, they assume the deceased person's cost basis and only would pay capital gains tax whenever they sell they assets just as if the dead person had sold the assets while alive.
Then maybe they should get rid of the step up in basis for anyone with estates over $10.9M.
Posted on 1/19/16 at 10:09 am to baytiger
quote:
(I don't really have much of my own opinion on estate taxes, as it'll probably never be my problem)
To be fair, it isn't really a problem for people who know what they're doing. The biggest problems arise from people who had no clue it was coming and/or didn't give a damn.
In reality, most estate planning happens far too late in the process. You don't usually acquire an estate worth over $5M-$10M without having some legal and accounting advice along the way. Anyone worth their billing should start the planning process as you near those levels.
Without going into details, you can basically "gift" $5M to a trust and eliminate the inheritance tax on that gift down the road. It can grow to be worth $50M, but as long as the value was under the lifetime exclusion when it was placed into the trust, the gains are not taxable under the inheritance tax.
That is a simplified explanation of a myriad of ways the money/assets can continue forward in the family.
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