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My comments: Biden/Harris Death Tax Increase - The current administration, under the Biden/Harris administration, has indeed suggested changes that could effectively increase what is commonly referred to as the "death tax," specifically through proposed modifications to estate and gift taxation.
### Proposed Changes to Estate Tax
1. **Reduction of Estate Tax Exemption**: President Biden has expressed intentions to lower the estate tax exemption levels significantly. Currently, the exemption is set at approximately $11.7 million for individuals and $23.4 million for married couples. Biden's proposals could reduce this exemption to as low as $5 million or even revert to the 2009 level of $3.5 million for individuals, which would affect a larger number of estates[1][2].
2. **Elimination of the Step-Up Basis**: Another significant proposal involves the elimination of the "step-up basis" rule, which currently allows heirs to inherit property at its fair market value at the time of the decedent's death. This means that if an asset appreciates significantly, heirs do not pay capital gains tax on the appreciation that occurred during the decedent's lifetime. Under the proposed changes, the basis would carry over, meaning heirs would inherit the asset at its original purchase price, leading to potentially substantial capital gains taxes if the asset is sold shortly after inheritance[2][4].
3. **Impact on Families and Businesses**: These proposed changes could impose significant financial burdens on families inheriting assets, particularly those with appreciated properties or family-owned businesses and family farms. The potential tax liabilities could force some families to sell assets to cover these new tax obligations, which has raised concerns about the long-term viability of generational wealth transfer[4][5].
### Conclusion
While these proposals are still under discussion and would require legislative approval, they represent a shift towards increasing the tax burden associated with estate transfers. If implemented, these changes could significantly affect how estates are taxed upon death, effectively increasing the financial obligations of heirs.
What's not under discussion is - Social Security Tax: The Social Security tax rate is currently set at 6.2% for employees and employers on earnings up to a CERTAIN CAP of ($168,600 for 2024). Self-employed individuals pay 12.4% on their net earnings up to this cap. This cap has increased over time, which can result in higher contributions. Note that this does not effect the higher incomes above the cap. It does benefit the illegals that the Biden/Harris administration want to use these funds to help those that have not paid a cent into Social Security.
Citations:
[1] https://www.skadden.com/insights/publications/2020/09/quarterly-insights/bidens-tax-proposals-and-estate-planning
[2] https://pbwslaw.com/biden-administration-may-spell-changes-to-estate-tax-exemptions-and-basis-step-up-rule/
[3] https://taxfoundation.org/research/all/federal/biden-budget-2025-tax-proposals/
[4] https://www.forbes.com/sites/leonlabrecque/2021/07/15/the-new-death-tax-in-the-biden-tax-proposal-major-tax-change/
[5] https://waysandmeans.house.gov/2024/03/14/the-biden-tax-hike-will-likely-exceed-7-trillion/
[6] https://itep.org/federal-estate-tax-historic-lows-2023/
[7] https://www.kiplinger.com/taxes/biden-income-tax-on-death
[8] https://www.forbes.com/sites/martinshenkman/2024/03/17/biden-2025-budget-proposal-could-slash-what-your-heirs-get/
### Proposed Changes to Estate Tax
1. **Reduction of Estate Tax Exemption**: President Biden has expressed intentions to lower the estate tax exemption levels significantly. Currently, the exemption is set at approximately $11.7 million for individuals and $23.4 million for married couples. Biden's proposals could reduce this exemption to as low as $5 million or even revert to the 2009 level of $3.5 million for individuals, which would affect a larger number of estates[1][2].
2. **Elimination of the Step-Up Basis**: Another significant proposal involves the elimination of the "step-up basis" rule, which currently allows heirs to inherit property at its fair market value at the time of the decedent's death. This means that if an asset appreciates significantly, heirs do not pay capital gains tax on the appreciation that occurred during the decedent's lifetime. Under the proposed changes, the basis would carry over, meaning heirs would inherit the asset at its original purchase price, leading to potentially substantial capital gains taxes if the asset is sold shortly after inheritance[2][4].
3. **Impact on Families and Businesses**: These proposed changes could impose significant financial burdens on families inheriting assets, particularly those with appreciated properties or family-owned businesses and family farms. The potential tax liabilities could force some families to sell assets to cover these new tax obligations, which has raised concerns about the long-term viability of generational wealth transfer[4][5].
### Conclusion
While these proposals are still under discussion and would require legislative approval, they represent a shift towards increasing the tax burden associated with estate transfers. If implemented, these changes could significantly affect how estates are taxed upon death, effectively increasing the financial obligations of heirs.
What's not under discussion is - Social Security Tax: The Social Security tax rate is currently set at 6.2% for employees and employers on earnings up to a CERTAIN CAP of ($168,600 for 2024). Self-employed individuals pay 12.4% on their net earnings up to this cap. This cap has increased over time, which can result in higher contributions. Note that this does not effect the higher incomes above the cap. It does benefit the illegals that the Biden/Harris administration want to use these funds to help those that have not paid a cent into Social Security.
Citations:
[1] https://www.skadden.com/insights/publications/2020/09/quarterly-insights/bidens-tax-proposals-and-estate-planning
[2] https://pbwslaw.com/biden-administration-may-spell-changes-to-estate-tax-exemptions-and-basis-step-up-rule/
[3] https://taxfoundation.org/research/all/federal/biden-budget-2025-tax-proposals/
[4] https://www.forbes.com/sites/leonlabrecque/2021/07/15/the-new-death-tax-in-the-biden-tax-proposal-major-tax-change/
[5] https://waysandmeans.house.gov/2024/03/14/the-biden-tax-hike-will-likely-exceed-7-trillion/
[6] https://itep.org/federal-estate-tax-historic-lows-2023/
[7] https://www.kiplinger.com/taxes/biden-income-tax-on-death
[8] https://www.forbes.com/sites/martinshenkman/2024/03/17/biden-2025-budget-proposal-could-slash-what-your-heirs-get/
Biden's Plans to Impose an Income Tax on Death
Posted from kiplinger.comPosted in these groups: 
Political Opinions
Political Opinions
Edited 20 d ago
Posted 20 d ago
Responses: 5
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SPC Jeff Daley, PhD
It's called redistribution of wealth akin to telling a student I am going to take the A that you earned and give you a B so I can move the D student to a C.
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LTC Kevin B.
SPC Jeff Daley, PhD - So is an inheritance. It's redistributing wealth from someone who earned it (the deceased) to someone who didn't (their heirs).
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SPC Jeff Daley, PhD
LTC Kevin B. - So the farmers and small business owners that has their children working along side them to build the business must sell the business so they can pay taxes? If you need the government to help manage your profits you probably didn't have much of a business in the first place. Sad.
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LTC Kevin B.
SPC Jeff Daley, PhD - If someone is given a business for free, yes I think they should pay taxes on it.
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SPC Jeff Daley, PhD
LTC Kevin B. - Perhaps the Biden/Harris administration is looking at Venezuela as their model for the death tax and future high taxes. The higher taxes will have a high impact on disposable income for the lower and mid income earners.
Yes, Venezuela has a death tax, commonly referred to as the estate and gift tax. This tax is applied to inheritances and gifts, with rates varying based on the value of the inheritance and the relationship between the deceased and the beneficiary.
### Tax Structure
1. **Categories of Beneficiaries**:
- **Category I**: Spouse, direct ascendants, direct descendants, and adopted children.
- **Category II**: Siblings, nephews, and nieces.
- **Category III**: Uncles, aunts, and first cousins.
- **Category IV**: Any other person.
2. **Tax Rates**:
- The tax rates range from **1% to 55%**, depending on the value of the inheritance and the degree of kinship. Higher rates apply to more distant relatives and non-relatives[2][3][4][5].
3. **Taxable Amount**:
- The taxable inheritance is calculated by deducting debts, funeral expenses, and attorney fees from the gross estate value[3][4].
Overall, the estate and gift tax in Venezuela is a significant consideration for beneficiaries, as it impacts the net value they receive from an inheritance.
Citations:
[1] https://taxfoundation.org/research/all/federal/estate-and-inheritance-taxes-around-world/
[2] https://en.wikipedia.org/wiki/Inheritance_tax
[3] https://www.globalpropertyguide.com/latin-america/venezuela/inheritance
[4] https://taxsummaries.pwc.com/venezuela/individual/other-taxes
[5] https://assets.kpmg.com/content/dam/kpmg/xx/pdf/2023/01/TIES-Venezuela.pdf
[6] https://taxsummaries.pwc.com/quick-charts/inheritance-and-gift-tax-rates
[7] https://files.taxfoundation.org/legacy/docs/TaxFoundation_FF458.pdf
[8] https://assets.kpmg.com/content/dam/kpmg/xx/pdf/2023/01/TBB-Venezuela.pdf
Yes, Venezuela has a death tax, commonly referred to as the estate and gift tax. This tax is applied to inheritances and gifts, with rates varying based on the value of the inheritance and the relationship between the deceased and the beneficiary.
### Tax Structure
1. **Categories of Beneficiaries**:
- **Category I**: Spouse, direct ascendants, direct descendants, and adopted children.
- **Category II**: Siblings, nephews, and nieces.
- **Category III**: Uncles, aunts, and first cousins.
- **Category IV**: Any other person.
2. **Tax Rates**:
- The tax rates range from **1% to 55%**, depending on the value of the inheritance and the degree of kinship. Higher rates apply to more distant relatives and non-relatives[2][3][4][5].
3. **Taxable Amount**:
- The taxable inheritance is calculated by deducting debts, funeral expenses, and attorney fees from the gross estate value[3][4].
Overall, the estate and gift tax in Venezuela is a significant consideration for beneficiaries, as it impacts the net value they receive from an inheritance.
Citations:
[1] https://taxfoundation.org/research/all/federal/estate-and-inheritance-taxes-around-world/
[2] https://en.wikipedia.org/wiki/Inheritance_tax
[3] https://www.globalpropertyguide.com/latin-america/venezuela/inheritance
[4] https://taxsummaries.pwc.com/venezuela/individual/other-taxes
[5] https://assets.kpmg.com/content/dam/kpmg/xx/pdf/2023/01/TIES-Venezuela.pdf
[6] https://taxsummaries.pwc.com/quick-charts/inheritance-and-gift-tax-rates
[7] https://files.taxfoundation.org/legacy/docs/TaxFoundation_FF458.pdf
[8] https://assets.kpmg.com/content/dam/kpmg/xx/pdf/2023/01/TBB-Venezuela.pdf
Estate and Inheritance Taxes around the World
The U.S. is one of many countries that levies taxes on estates or inheritances. Of all America’s taxes, the estate tax is perhaps the most contentious.
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LTC Kevin B.
SPC Jeff Daley, PhD - I don't care about tax rates in Venezuela, but thanks for dragging into the discussion an irrelevant scare tactic. The US will not become Venezuela, regardless of who wins the election, and regardless of any tax policy they implement.
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SPC Jeff Daley, PhD
LTC Kevin B. - This situation is comparable to the path we are currently following. Historical evidence corroborates this perspective. Examining established facts is not intended to instill fear; rather, it pertains to pertinent information related to the discourse. If you find yourself unsettled by the examination of these facts, it may indicate a need for reflection, provided you are open to engaging with this matter intellectually.
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Democrats, tax and tax so they can spend and spend. How about lets find ways to cut spending.
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LTC Kevin B.
SSG (Join to see) - Actually, if the government followed a pure tax and spend policy (equal taxes for every penny spent), it wouldn't pass on any debt to our descendants. Everything would have been paid for at the time it was spent. However, the borrow and spend policy sure would pass on debt. The "borrow and spend" politicians are taking tomorrow's money from our kids, then spending it today, and then forcing our kids to pay it back...plus interest...down the road. That's where your problem lies...unless you don't like the idea of leaving them a better world than what you were given.
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SSG (Join to see)
LTC Kevin B. - This is true, most of our current tax system is used to just pay the interest on the current debt. But until we rope in government spending and government waste I am afraid this problem will not go away.
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LTC Kevin B.
SSG (Join to see) - It's far too easy to spend money to get votes. Both sides do it, and to absence levels. Neither side has clean hands when it comes to spending. We do need to cut spending, but nobody wants to give up their holy grails, and nobody wants to go after the biggest items (Social Security, Medicare, Medicaid, and Defense). Once those come off the table, you don't have much savings left to reap.
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From your article: "There is a $5 million lifetime gain exclusion. Plus other exceptions..."
The taxes are for millionaires with notable assets at death. The bottom 95% of American people would not be affected.
The taxes are for millionaires with notable assets at death. The bottom 95% of American people would not be affected.
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SPC Jeff Daley, PhD
History has proved that when a tax is in play the exclusions drift in the direction where more taxes are collected leaving the disposable income of tax payers depreciated.
LTC Eugene Chu
LTC Eugene Chu
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