All taxes are hated, and I expect no tax is hated more than the "death tax." After all, death is certainly something we hate, especially if our loved ones might be taxed on it. Indeed, it has been a common misconception that the death tax burden could force the sale of the family farm, leaving grandma nowhere to live.
I first became a trust officer in 1972, and that has never been true. Common misconceptions die slowly. For most of that time, if the primary asset of a family farm or family business was more than a certain percentage of the total estate, then the estate could pay the tax bill over a ten-year period. Recently, the IRS held that if an asset was more than 35% of the total estate, the resulting tax could still be paid out over ten years, but that ten-year amortization period would not begin for another 5 years. In other words, you would have 15 years to deal with the problem.
And, in case you haven't noticed, a married couple now doesn't have to pay any tax until their combined estate is well over $10 million. In 1972, it was a mere $120 thousand.
I doubt that will cause the tax to be any less hated, but I would hope we could at least call it by the correct name, which is the Federal Estate tax . . . it was never named a death tax. If common misconceptions die slowly, how long does it take a derogatory nickname to die?
I first became a trust officer in 1972, and that has never been true. Common misconceptions die slowly. For most of that time, if the primary asset of a family farm or family business was more than a certain percentage of the total estate, then the estate could pay the tax bill over a ten-year period. Recently, the IRS held that if an asset was more than 35% of the total estate, the resulting tax could still be paid out over ten years, but that ten-year amortization period would not begin for another 5 years. In other words, you would have 15 years to deal with the problem.
And, in case you haven't noticed, a married couple now doesn't have to pay any tax until their combined estate is well over $10 million. In 1972, it was a mere $120 thousand.
I doubt that will cause the tax to be any less hated, but I would hope we could at least call it by the correct name, which is the Federal Estate tax . . . it was never named a death tax. If common misconceptions die slowly, how long does it take a derogatory nickname to die?
