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[quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous]I wish I did have a solution but I strongly believe the gap between the well off and the poor underlies much of what is going wrong in our society. [b]I’m in favor of something like an inheritance tax.[/b] Something where you can leave a reasonable amount of money to each of your children but the rest goes to the government. That’s probably impractical but it might be a start. And by reasonable I mean $5 million or $10 million. Something indexed for inflation. But this idea of having huge amounts of money passed to the next next generation seems a little off to me. [/quote]

I'm the PP at 14:25 who has studied tax policy in the context of wealth disparity. Like I said, I have never really found an answer. But the closest thing to a good answer was to drastically increase transfer taxes (inheritance and gift). I think it is the most palatable answer all around (if not the best one), but in the US extreme notions about property rights prevail, making this close to politically impossible. [/quote]

In practice though this would really impact small and medium-sized businesses, not just “farms.” And if all buyers knew the owners were facing big estate tax bills, you wouldn’t even be able to sell them fairly. You can do planning but death is still unpredictable and at a minimum you will leave people with tough choices about using all the liquid assets to pay taxes to keep a business that could be in any kind of shape. [/quote]

Depends on who you tax. If it's a $1 Billion business, I don't care what they call themselves (mom and pop or Big corp), they should pay up. At that level they should have the wealth and income to hire the right lawyers to prepare for this eventuality. Ownership at that level will be in stock anyways so they can just sell it in the open market.[/quote]

No, not really. There isn’t generally a market for minority stakes in private businesses at anything close to their valuation. Having stock in a private company isn’t like having it in your investment account. It’s more like okay aunt Myrtle died and she owns 30% of the company. Her share is valued at $50m and she has $10m in other assets. You’re right about the lawyers and people will use trusts and family foundations and other maneuvers to make it work out unless it was a surprise but that kind of just defeats the point, doesn’t it? [/quote]

Well, the Trust BS needs to be fixed as well. Overhaul is not changing tax rates, it's also fixing the loopholes. As to how Aunt Myrtle's descendants pay estate taxes, they'll have to sell their stake, maybe to employees or, better yet, use all those high paying lawyers to plan for her demise and begin liquidating stock over the years so there's enough set aside in cash to pay those darn taxes. Either way, we can't go on only cutting expenses and not increasing revenue. At some point that will break the camel's back the we won't like the results. [/quote]

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