Glad I could help then. 
For what it’s worth, I never grokked the double taxation argument either. There might be good arguments against the estates tax, but this is not one of them. Not only, as you correctly state, are there many other instances where money gets taxed twice ; but if taxing once can be justified, and most of us agree it can and is, then taxing the same money twice, thrice, a billion times in a row is just as justifiable and justified, on the exact same grounds as the first time.
As to the OP: one problem with closing loopholes and all attempts at amending legislation in order to chase tax evaders that I’ve often heard is that the law moves agonizingly slowly. It takes a long time to draft a bill that’d fairly and efficiently address a given problem, a long time to get that bill passed, and even after it’s been passed it takes a while for the IRS (or whatever enforcement agency is involved) to train its people on how it works and effectively apply the new rules and regulations without screwing up.
Meanwhile it takes about an afternoon on the phone to radically change wherever one’s money is at the moment, and get it where it’ll be taxed the least.
So in essence, by the time the new rules are applied there’s nothing much left for them to be applied on, new tax havens have been invented, new laws need to be drafted to chase after those, yadda yadda. Tautologically, the fantastically rich tend to be dab hands at the art of keeping the money. All of the money.
Amazing, isn’t it? A mystery for sure. An enduring enigma that people, when you try to take their money, resist and try to find ways to prevent you from doing it. Really hard to understand, isn’t it? What could possibly be going on in their heads?
It’s not much of a mystery. People tend to dig in to defend what they consider theirs. In this case people come to believe they have a right to their wealth and that society as a whole should just butt out while the plain truth is that “rights” and “wealth” are creations of society as are the judgments determining ownership. The hard part is not figuring out the motivations of those with a sense of entitlement, nor, it seems to me (to briefly address the OP) determining methods for collecting an Estate Tax but rather in getting the political will to make changes in the face of uncompromising resistance from the wealthy and powerful. It’s not a psychological or accounting question but a political one.
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People tend to dig in to defend what they consider theirs.
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Yeah, it’s strange how people consider their stuff their own, to do with as they wish, instead of the obvious reality, which is that all their stuff is really belonging to society. Right?
Funny how folks come to believe that their stuff is theirs, and that they have rights and such, when in fact they don’t actually own anything, and really have no rights if ‘society’ deems that, for the good of the people all your base belong to us!!
As opposed to the uncompromising resistance from the powerful left wingers who are doing all of this for The Good Of The People…and, of course, that sense of entitlement (entitlement to all the goodies that folks erroneously feel are theirs because they own them, when in reality everything belongs to the good workers and peasants, to be seized and distributed as largess from the folks who know whats best, ehe?).
Well, I agree with you here, at least. It’s threads like this that remind me that while right wingers are assholes, left wingers are…scary. Gods help us all if either side ever really gets control of this country. :eek:
Funny, I thought Bill Gates was paying taxes on his income as he did all of the above.
If you had known my parents, then you’d know that their estate consisted almost entirely of the value of their primary residence. And as a matter or fact, they were never taxed on the appreciation of the house.
There can be no absolute and objective ownership of anything outside of society. Property is a social construct. Without society there is no property. Here in America social norms include admiration for (indeed almost worship of) private property. The point is not collective ownership but rather that we should not forget the true nature of what is being considered.
It’s no surprise people so often fail to understand the nature of property. How many of us ever learned of it in the first place? It’s hardly a hot topic in American education. Certainly people have rights to their property. But only those rights which society has conferred. At times like these when people like Terr take things for granted a reminder of the actual situation is helpful. Property is no more independent of society than a wave is independent of water.
It’s been said that those of us over on the left tend to be more comfortable dealing with shades of gray but just because the simple black and white world of “what’s mine is mine” is a child’s fantasy doesn’t mean you have to be frightened. Social norms may seem flimsy things because they rest only on collective acceptance but you really can trust people to reliably follow them most of the time. The evidence is all around. If this were not true we wouldn’t have been able to work together to build this complex world we live in today.
Yeah, but so what? Your point is both inarguable and irrelevant. The question is not whether or not society can impose its will to establish and support what “rights” exist. The question is what is appropriate and moral, and that will always be reduced to an individual’s axioms, yours included. I say that because I’m inferring, maybe incorrectly, that you see your position as somehow objective in a way those “poor, deluded, immature” right wingers’ is not.
I believe, along with others in this thread, that property is earned, received as a gift, inherited, legitimately found, etc.–and that we needn’t analyze these concepts too deeply within a social construct to understand what “my stuff” means. And the right to one’s property is so essential a liberty that it is one of those rights that is about as close to inviolable as a right can be. Yes, it’s so basic a child can understand it, but so it it is with many foundational concepts. And, yes, I realize this is simply axiomatic for me.
Saying, “yeah, but society may change that construct if it collectively chooses to do so” isn’t terribly illuminating, since the same could be said about anything.
A fundamental lack of respect for the social contract ?
Its not necessarily a blind trust. The intentionally defective trust is possible because of a disconnect between what the income tax law thinks you own and what the estate tax laws think you own. If you conformed these two concepts the intentionally defective trust would disappear.
The income tax law says that you still own the trust so you owe the taxes on the income inside the trust so then trust doesn’t get reduced by taxes when it earns income. The estate tax law says that you no longer own the trust so it is not subject to the estate tax.
Isn’t it conservatives that always say that every little bit helps (or is that only applicable when we are talking about spending cuts)?
It takes time to develop ways to circumvent these laws. Are you under the impression that a well advised billionaire can totally escape the estate tax with really good planning? Tax law is a an arms race between the government and tax lawyers.
Its not misleading at all. Until fairly recently, it was common practice for hedge fund managers to contribute a protion of their carried interst into a trust and value it at ZERO. It tough to catch these things because we keep cutting the legs out from under our enforcement personnel. The last administration fired 157 of 345 estate tax lawyers. They were the most productive enforcement side lawyers at the IRS, generating over $2,000 of taxes per hour worked.
Almost all of Bill Gates’ wealth has never been taxed in his hands.
I pay income taxes on my income then I pay a sales tax when I spend the money. The world hasn’t collapsed under the weight of this grave injustice but I have my fingers crossed.
Does the income tax rob the living?
It sounds like your just upset about taxes generally.
Probably not.
When people pass revenue raising provisions, they do so because they want it scored to raise a lot of revenue. The CBO does the scoring.
Loopholes are frequently the result of imperfect legislation or highly contorted tax driven structures (why the hell would anyone ever create an intentionally defective trust BUT FOR the arbitrage it achieves between the income tax and the estate tax).
That is not how your posts read. You sound like you are just offended by the mere fact that government collects taxes. Your arguments would apply to almost every tax under the sun.
If my mother has enough money to be subject to the estate tax when she dies ($5 million), the inheritance would take some of the sting out of the loss, even if the government takes a cut.
+1
I don’t know what you believe my position to be here. I made my point and you conceded it. What more is there?
Having agreed with my point it’s no surprise this is not illuminating for you. What you and I take for common sense XT seems to see as liberal conspiracy.
Probably because it wasn’t exempt. You already taxed that money, remember?
This is where people come in and cry “double taxation” to which you ignore.
…because those people are stupid. Inheritance is a transfer of wealth from one person to another. Every other transfer (subject to limits on size, of course) is taxable.
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Having agreed with my point it’s no surprise this is not illuminating for you. What you and I take for common sense XT seems to see as liberal conspiracy.
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Leaving aside the fact that you obviously misunderheard what Stratocaster was saying there, I’d like to point out two things. First of all, I never said ‘liberal’. I said left wing. And it’s not a conspiracy if they come right out in the open with their agenda. 
I love they way you tried to spin the whole discussion to me being some sort of right wing nutter though. It really worked for you and definitely allowed you to simply handwave away my points…
I thought I had made it clear that I didn’t fully understand Stratocaster’s post. But what did seem clear was that whatever else he read into my words he took my discussion of rights as an accurate description. I didn’t get the same sense from your post.
I don’t think you are a right wing nutter and it was not my intention to portray you in that light. On the contrary, I have respect for your ability to consider these endless questions here and on occasion change your mind based on the evidence. A rare talent even on an exceptional internet forum such as this. In this case I do think you would have done better to respond to what I actually said rather than what you believe I really meant.
We don’t tax spousal transfers upon death of a spouse.
Bill Gates is much better at spending his money than the government is. And if it was passed down to his heirs (which it isn’t) they would continue to generate jobs and pay taxes on it.
The government on the other hand, would piss it away until it’s gone because governments don’t generate wealth.
Because married couples are basically considered one “unit” under the law.
He sure is. Like building a custom home where you walk around with a special chip in your pocket so that every room will adjust to your favorite temperature as soon as you enter it, or getting Bill Clinton to sign a special law to allow him to drive his custom Porsche 959. I’m not saying that his foundation doesn’t do great things, but like everyone with money, he does have extravagances.
Yes I do, because as a recent New Yorker article about how the super-wealthy feel “victimized” by (among other things) democratic calls for higher taxes, they make it oh so easy…
Our aristocratic betters are complaining that the peasants aren’t appreciative enough of their noble largess (all of which, by the way, are tax deductible). I recommend reading the whole article for a look into their twisted mindset (though probably not right after lunch).
Apparently the author of the article pulled the numbers straight out of his backside.
“The middle class anonymously and nervously pays its thirty-five per cent to the I.R.S., while the super-rich pay fourteen per cent”
http://taxfoundation.org/article/summary-latest-federal-individual-income-tax-data-0#table8
Let’s see: top 0.1% (that’s “super-rich”, right?) have the average rate of 24.28% and the “nervous and anonymous middle class” pays either 11.36% (if you take between top 5% and 10%) or 8.25% (if you take the ones between 10% and 25%).