She’s The Poster Child for Estate Tax Repeal, but Her Sad Family Saga Doesn’t Add Up

rich-estate-tax

(Photo: Shutterstock)

Republican Rep. Kristi Noem of South Dakota is one of the negotiators trying to reconcile the House and Senate tax bills. No doubt House Speaker Paul Ryan views her as a strong voice for estate tax repeal, because of her personal story of how her farming family struggled to pay the tax.

The House bill would abolish the estate tax, a levy on the intergenerational transfer of immense wealth. The Senate version retains the tax but doubles the wealth exempted from the tax, to $ 22 million for a family.

Congressional Republicans and their backers have painted the estate tax as a major burden on the nation’s ranchers and farmers. Yet it’s the heirs of multimillionaires and billionaires who actually pay it.

Noem perpetuates the “estate tax hurts farmers” argument using her life experience. The story she tells, however, does not line up with some very basic tenets of the tax code. Now, 23 years later, it is high time to get the facts. It’s also an important time to understand just who is subject to the estate tax and what its repeal really means.

Read the full article on USA Today.

The post She’s The Poster Child for Estate Tax Repeal, but Her Sad Family Saga Doesn’t Add Up appeared first on Institute for Policy Studies.

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INDIANA FARMER CAMPAIGNING WITH TRUMP TO REPEAL ESTATE TAX CASHED $3.3 M IN FARM SUBSIDY CHECKS

FOR IMMEDIATE RELEASE, September 27, 2017

Contact: Jessicah Pierre, jessicah@ips-dc.org617-401-1470
Chuck Collins, chuck@ips-dc.org617-308-4433
Domenica Ghanem, domenica@ips-dc.org202 787 5205

Kip Tom, the Leesburg, Indiana farmer who will stand today with President Trump calling for repeal of the federal estate tax, has cashed in over $ 3.3 million in farm subsidy checks, including $ 2.6 million between 2004 and 2014, according to the most recent data available.

Research compiled by the Institute for Policy Studies based on publicly available data reveals that Kip Tom of Tom Farms, a large corn and soybean producer, is the ninth-largest farm subsidy recipient in the state of Indiana.

“The definition of hubris is to complain about your taxes but cash millions in checks provided by other taxpayers,” said Chuck Collins, a researcher at the Institute for Policy Studies.  “I’d be embarrassed.”

Tom Farms has changed legal status over the last 20 years, but received subsidies every year. Between 2004 and 2014, Tom Farms Partners received $ 2,612,561 in subsidies, mostly commodity subsidies. Between 1996 and 2006, Tom Farms LLC cashed $ 667,732 in farm subsidy checks. In 1995, Kip Tom took in $ 42,826 in subsidies, but then refunded $ 17,494 for a net subsidy of $ 25,332. Between 1995 and 2014, this amounts to over $ 3,305,625 in government subsidies.

Republicans have often used farmers and ranchers as props to give the impression that a wide swath of hard-working Americans are threatened by what they call the “death tax.”  In reality, only families with over $ 11 million in wealth and individuals with wealth over $ 5.45 million are subject to this tax.  Nationwide, fewer than two out of a thousand estates are subject to the estate tax, which, if left intact, would raise over $ 230 billion in much-needed revenue over the next decade.

“If you want to see who would benefit from estate tax repeal, look no further than President Trump and his cabinet,” said Collins, who co-authored a 2003 book with Bill Gates Sr. in defense of the estate tax, Wealth and Our Commonwealth.  Collins is director of the Program on Inequality at the Institute for Policy Studies, a 52-year old research institute, and co-editor of the website, Inequality.org.

Very few farms are subject to the estate tax and already have different valuations and carve out provisions. Most of the people who pay the estate tax are wealthy and based in urban and coastal areas.

Organizations that represent small farmers, like the National Farmers Union and the Family Farm Coalition, support retention of the estate tax.  They believe concentrations of wealth, farmland and farm subsidies post a threat to competitive agriculture. Over 41 percent of Indiana farmers do not receive any subsidies, according to the USDA.

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Long Live the Estate Tax

On August 25, the U.S marked the 100th anniversary of the National Park Service. In the words of historian Wallace Stegner, the parks are “the best idea we ever had. Absolutely American, absolutely democratic, they reflect us at our best rather than our worst.”

Several weeks after President Woodrow Wilson penned the act creating national parks, he signed America’s second best idea into law, the federal estate tax, our nation’s only levy on the inherited wealth of multi-millionaires and billionaires.

Like the park system, the estate tax is a fundamentally American notion, an absolutely democratic intervention against a drift toward plutocracy and extreme wealth imbalances. Taxing inheritances set the U.S. apart from the monarchies and wealth dynasties of Europe.

Read the full article on U.S. News & World Report’s website.

The post Long Live the Estate Tax appeared first on Institute for Policy Studies.

Chuck Collins is a  senior scholar at the Institute for Policy Studies where he directs the Program on Inequality and the Common Good.

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How Conservatives Exploit Estate Tax Confusion

“No family will have to pay the death tax,” intoned candidate Trump at his economic policy address in Detroit. “American workers have paid taxes their whole lives and they should not be taxed again at death and its just plain wrong and most people agree with that. We will repeal it.”

Few issues are so unhinged from reality as the estate tax. Candidates, mostly Republicans, puff themselves up with moral umbrage toward what they call the “death tax. ” The estate tax is in reality an inheritance tax on wealth over $ 11 million.

Workers? There are very few people whose livelihood depends on a paycheck that will pay the estate tax. All this GOP outrage is focused on a tax paid exclusively by multi-millionaires and billionaires. Fewer than 2 out of 1,000 estates will pay an estate tax.

Most of this wealth is not being “taxed again.” The bulk of assets subject to the estate tax are appreciated property — stocks and land that have risen in value — and have never been subject to a tax.

Eliminating the estate tax would provide a tiny sliver of taxpayers with an average tax break of $ 3 million. At a time of dizzying wealth inequality –where most of the wealth expansion of the last decade has gone to the wealthiest 1 percent –we should not give roughly 6,000 ultra-wealthy households an additional tax break.

Does the estate tax affect small businesses? No. A business worth more than $ 20 million that generates $ 1 million or 2 million a year may pay an estate tax. Someone who owns 3 or 4 car dealerships may be subject to the tax. But these individuals fall into the top one-fifth of the 1 percent.

Instead of repealing the estate tax, Congress should make it more progressive and close some of the loopholes that have opened up. Right now, estates over $ 15 million are taxed at the same rate as estates of $ 15 billion. A graduated rate structure would make the estate tax more progressive and put a brake on the concentration of wealth and power that is threatening our democracy.

Trump is right about one thing. Most people are very confused about who pays the estate tax and react negatively to the concept of a “death tax.” Two decades of anti-estate tax misinformation has taken its toll. Many people of modest means believe the tax may apply to them.

To protect the estate tax, we should link its revenue to something that expands opportunity for everyone else, such as debt free education or a first-time homebuyers fund. In Washington State, estate tax revenue is dedicated to an education legacy trust fund that supports K-12 education and state colleges.

The estate tax was established one hundred years ago to reduce extreme wealth inequality and generate revenue for the public good. An estate tax that expands education and wealth-building opportunities for those excluded from the last few decades of wealth expansion is an all-American idea whose time has come.

The post How Conservatives Exploit Estate Tax Confusion appeared first on Institute for Policy Studies.

Chuck Collins is a senior scholar at the Institute for Policy Studies and a co-editor of inequality.org. His forthcoming book is Born on Third Base.

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Half of Prince’s $300 Million Estate Could Be Taxed. That’s a Good Thing.

(Flickr / SynergyByDesign)

(Flickr / SynergyByDesign)

The massive global outpouring of emotion in the wake of the sudden death of pop sensation Prince has mostly subsided. What’s left is likely a prolonged dispute over his sizable estate, valued in the hundreds of millions of dollars—a dilemma made ever more complicated by his lack of a will.

Rooted in this dispute is an open question: How much of what Prince earned should go to the U.S. Treasury?

By any measure, Prince was an exceptionally productive musician. He racked up seven Grammy awards and released 39 studio albums, not to mention the reported 100 albums he recorded but never released. For this work, he was paid handsomely, generating a fortune worth over $ 300 million at his death.

Beyond his own talent, hard work, and a bit of luck, though, what else contributed to this fortune?

If you’re a taxpayer, you did.

Read the full article on American Prospect’s website.

The post Half of Prince’s $ 300 Million Estate Could Be Taxed. That’s a Good Thing. appeared first on Institute for Policy Studies.

Josh Hoxie directs the Project on Opportunity and Taxation at the Institute for Policy Studies.

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Estate Tax to the Rescue

american-flag-money-divide

(Image: Flickr / Steve Johnson)

The U.S. is facing a future of staggering inequalities.

If nothing changes in our tax code, the Center for Economic Policy Research now predicts, the wealthiest 1 percent of Americans will claim half of all private U.S. wealth in the next 20 years. Meanwhile, the assets of ordinary Americans are stagnant or eroding. Homeownership rates, a traditional measure of middle-class well-being, have been steadily declining since 2005.

The wealthiest 400 billionaires today have as much wealth as the bottom 62 percent of U.S. households combined, according to a study I coauthored with my Institute for Policy Studies colleague Josh Hoxie last year. The wealthiest 20 individuals alone – a group small enough to fit on a Gulfstream 650 luxury jet – have as much wealth as the bottom half of U.S. households.

In times past, popular mobilizations against this level of inequality led to path-breaking policy changes. During the Gilded Age of the late 19th and early 20th centuries, for instance, such pressure spurred President Theodore Roosevelt and industrialist Andrew Carnegie to become vocal supporters of progressive taxation.

Read the full article on U.S. News and World Report’s website.

The post Estate Tax to the Rescue appeared first on Institute for Policy Studies.

Chuck Collins directs the Program on Inequality and the Common Good at the Institute for Policy Studies.

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Ownership succession for family-owned banks : building the right estate plan – Lexology (registration)

Ownership succession for family-owned banks : building the right estate plan
Lexology (registration)
For purposes of the various statutory thresholds for determining control, ownership of immediate family members, including grandparents, siblings, and children, can be aggregated, leading to unexpected presumptions of control. Types of estate planning …

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Estate Tax Wars: Pinocchio on Viagra

Businessman with Pinocchio maskThis week, the Washington Post published two pieces on the federal estate tax, each drawing very different conclusions about what’s driving the repeal effort. An estate tax vote is expected Thursday in the House of Representatives, a move that will only benefit the nation’s billionaires and multi-millionaires. Yet only one of the two Post writers is able to see the facts for what they are.

On one side is Dana Milbank, longtime syndicated columnist and meticulous centrist, who titles his new piece, “Republicans push for a permanent aristocracy.” He states in no uncertain terms what the impact of estate tax repeal would be: “Never in the history of plutocracy has so much been given away to so few who need it so little.”

Milbank supports his argument with cold hard facts, which he cites to debunk the misleading and often absurd claims made by estate tax opponents. Estate tax repeal will not help low and moderate-income families, just the 5,500 wealthiest families who pay it each year. The $ 5.4 million exemption ($ 10.8 for married couples) prevents 99.8 percent of Americans from ever paying any estate tax.

The estate tax is not about protecting farms or small business. Notes Milbank: “In the entire country, only 120 small businesses and farms (100 of them large farms) were hit by the estate tax in 2013.” Plenty of protections exist for those few small businesses and farms impacted and, it’s worth noting, no farm has ever been lost as a result of the estate tax.

Repealing the estate tax really is just about helping the rich at the expense of everyone else. Milbank cites the $ 269 billion hole created by estate tax repeal and points out that “the 318 wealthiest estates each year — those worth $ 50 million or more — would see an average windfall of $ 20?million each.”

On the other side is Glenn Kessler, head of the popular Fact Checker blog at the Washington Post, who titled his piece, “Is the estate tax killing small farms and businesses?”

The answer to Kessler’s question, clear to anyone who takes even a cursory look at the facts, is decidedly no. But despite citing the same facts as Milbank, Kessler is unable to draw that conclusion. He writes instead: “The raw facts may not entirely support the case against the estate tax, but increasingly this does not seem to matter.”

Kessler declines to give a “Pinocchio rating” to the GOP’s claims because, in his words, “the issue of the estate tax has become so unmoored from the facts that it has moved into the realm of opinion.”

How can a column that calls itself “Fact Checker” claim the facts apparently don’t matter? Anti-tax zealots in the GOP have spent decades distorting the facts. Now a fact checker gives them a pass because their deception has reached new heights? As the kids say, SMDH (Shake My Damn Head for non-texters).

The lies from estate tax opponents, that Kessler himself quotes, are proven blatantly false in his article. But instead of giving them the ranking they deserve, “Pinocchio on Viagra,” as fact checkers at the Associated Press and Factcheck.org did (using slightly different language), Kessler gives them a pass. For that matter, he gives fact telling a pass.

 

The post Estate Tax Wars: Pinocchio on Viagra appeared first on Institute for Policy Studies.

Josh Hoxie tracks the debate over the estate tax and other grand divide-related concerns for the Institute for Policy Studies Program on Inequality and the Common Good.

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Stream of Foreign Wealth Flows to Elite New York Real Estate – New York Times


New York Times
Stream of Foreign Wealth Flows to Elite New York Real Estate
New York Times
Last fall, another shell company bought a condo down the hall for $ 21.4 million from a Greek businessman named Dimitrios Contominas, who was arrested a year ago as part of a corruption sweep in Greece. A few floors down are three condos owned by …
Hidden River of Wealth Flows to New York's Luxury CondosNDTV

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Real Estate in Greece – New York Times


New York Times
Real Estate in Greece
New York Times
On a hilltop on the largest of the Cyclades islands in the Aegean Sea, this multilevel home, with multiple shaded verandas and stone perimeter walls, was built in 2004 on a 1.36-acre lot overlooking Orkos Bay and Plaka Beach. Known as Tower Villa, it

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