Nothing’s Certain Except for ….

By March 6, 2008Taxation

Don’t like the tax? Just change the name.

The Senate Finance Committee is going to hold a hearing on March 12th on the estate tax, part of a series of hearings that Chairman Baucus promised to schedule last year. Unfortunately, the focus of the hearing will be to replace the estate tax with … an inheritance tax. That’s right. We’ll replace one bad tax with another bad tax.

How is an estate tax different from an inheritance tax? Well, the estate tax is placed on the estate of the person who dies. The inheritance tax is placed on the person who inherits the estate. The reality is, regardless of who specifically is taxed, when a business is passed on to an heir and there isn’t liquid capital to pay the tax – then the business is sold off to pay the tax. You can call it the estate tax or the inheritance tax. We call it the death tax because it kills family businesses. End of story.

Watch for future hearings from the Senate Finance Committee: Replacing the income tax with a wage tax. Replacing the sales tax with a buyers tax. The list goes on.

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