Estate Tax amazonaws com
Estate Tax Background: Under current law, the estate (death) tax for individuals has been phased out through 2010. However, in 2011 the estate tax reverts back to its pre-repeal level, which means lower exemptions and higher tax rates. This will amount to a tax increase! This unfair tax forces families to sell precious assets because they can’t afford to pay the estate taxes when a loved one dies. Estimates suggest that for all small business owners, 33 percent report that they expect all or part of their business to be liquidated when death taxes come due. It also forces families to create complicated estate plans to preserve their businesses.
Key Points: Kills job creation and economic growth because it levies yet another layer of taxes on capital. By encouraging intricate planning techniques to reduce taxes, the death tax has created an entire industry of specialized lawyers and accountants. The added complexity and compliance costs make this one of the least efficient federal taxes. Saps the entrepreneurial spirit. Imposing a death tax on estates over a certain limit will have a chilling effect on a small business owner’s plans to expand their business. In determining whether to increase the size of their business, a business owner would have to factor in the potential estate tax liability – thus imposing an artificial limit on the size of small businesses. Is unfair double taxation since taxpayers are taxed twice – once when the money is earned and again when you die. A person who works hard, pays taxes along the way – both corporate and income taxes – and invests and saves money, should not be penalized with punitive taxes at his or her death. One of the main purposes for repeal of the estate tax was that small businesses were wasting time and resources on estate tax planning. The temporary nature of repeal only makes matters worse. Anyone who inherits a family business in 2010 will be exempt from any estate tax obligations; if they inherit the business in 2011, they will potentially be subject to a 55 percent estate tax if their estate is valued above $1 million. Time and resources must continue to be spent worrying about whether one’s business will continue under the leadership of the heirs of the business instead of being able to dedicate financial resources to grow a business. This onerous tax punishes families for building up savings to pass on to their heirs and it imposes an especially heavy burden on small businesses and family farms.
PHCC Position: The Plumbing-Heating-Cooling Contractors – National Association (PHCC) supports legislation that would make repeal of the estate tax permanent. However, PHCC is encouraged by the proposal set forward by President Obama, the Senate and the House in which the estate tax exemption would be “frozen” at $3.5 million for individuals and $7 million for couples while the top rate would be “frozen” at 35 percent.
Celebrate The Past, Join Our Future. 180 S. Washington Street • Falls Church, VA 22046 • 1-800-533-7694 • 703-237-8100 • Fax 703-237-7442 • www.phccweb.org • [email protected]
Key Points: Kills job creation and economic growth because it levies yet another layer of taxes on capital. By encouraging intricate planning techniques to reduce taxes, the death tax has created an entire industry of specialized lawyers and accountants. The added complexity and compliance costs make this one of the least efficient federal taxes. Saps the entrepreneurial spirit. Imposing a death tax on estates over a certain limit will have a chilling effect on a small business owner’s plans to expand their business. In determining whether to increase the size of their business, a business owner would have to factor in the potential estate tax liability – thus imposing an artificial limit on the size of small businesses. Is unfair double taxation since taxpayers are taxed twice – once when the money is earned and again when you die. A person who works hard, pays taxes along the way – both corporate and income taxes – and invests and saves money, should not be penalized with punitive taxes at his or her death. One of the main purposes for repeal of the estate tax was that small businesses were wasting time and resources on estate tax planning. The temporary nature of repeal only makes matters worse. Anyone who inherits a family business in 2010 will be exempt from any estate tax obligations; if they inherit the business in 2011, they will potentially be subject to a 55 percent estate tax if their estate is valued above $1 million. Time and resources must continue to be spent worrying about whether one’s business will continue under the leadership of the heirs of the business instead of being able to dedicate financial resources to grow a business. This onerous tax punishes families for building up savings to pass on to their heirs and it imposes an especially heavy burden on small businesses and family farms.
PHCC Position: The Plumbing-Heating-Cooling Contractors – National Association (PHCC) supports legislation that would make repeal of the estate tax permanent. However, PHCC is encouraged by the proposal set forward by President Obama, the Senate and the House in which the estate tax exemption would be “frozen” at $3.5 million for individuals and $7 million for couples while the top rate would be “frozen” at 35 percent.
Celebrate The Past, Join Our Future. 180 S. Washington Street • Falls Church, VA 22046 • 1-800-533-7694 • 703-237-8100 • Fax 703-237-7442 • www.phccweb.org • [email protected]
