Tags: GOP | Obama | Estate Tax | Charitable Limitation

GOP Should Enact Obama's Estate-Tax Charitable-Limitation Proposal

By
Sunday, 08 Feb 2015 06:04 PM Current | Bio | Archive

Warren Buffett and Bill Gates have both expressed strong support for keeping the estate tax.

They think it is good that rich people pay their fair share of their wealth at death to be redistributed by the government.

President Barack Obama feels the same way.

I think they should get what they want. And they should get it hard.

Since Buffett and Gates have started the Buffett-Gates Giving Pledge Program they have been encouraging the rich to give their fortunes to charitable foundations. Philanthropy has become the new penance the rich must pay for their evil ways during life by becoming, well, rich.

It just so happens that by stuffing their fortunes into private charitable foundations they can completely avoid paying any estate tax. It’s part of the thinking process that only unsophisticated people need to pay tax anyway.

What really happens when the rich give all those assets to their private foundation?

Nothing.

One of the great things about being tax sophisticated is that you can afford the tax professionals who can make sure the family business stays in the family and doesn’t pay tax.

Bill Gates may have given away Microsoft stock, but he gave it to the Gates Foundation which he still controls. Basically, his foundation is just his alter ego. The same is true of all the other big time foundations.

This tactic has very powerful proponents who hold tremendous political clout.

There is a vast industry of lawyers, accountants, money managers, investment advisors, insurance specialists, administrators, psychologists and life coaches, not to mention the publishers, conference organizers, grant makers, and others all of whom make their living because the rich don’t pay estate tax.

What’s more, all this wealth held in these private foundations (now amounting to trillions of dollars) are effectively secrete money which operates in the shadows. Yes, it can be used for good purposes, but it also is used for a lot of really nasty stuff.

Now to be clear about this, I am in favor of repealing the estate tax and getting rid of unaccountable private foundations.

But since this is not going to happen, since so many have a stake in keeping it in place, then why shouldn’t the government get in on the goodies.

If Bill Gates and Warren Buffett decide that they are going to give away their money, then why should they complain if the government takes a fair share of it?

Maybe if the rich like Buffett and Gates felt some financial pain, had a little economic skin in the game, paid their fair share of tax on all the wealth, they would see the light about why the less sophisticated people want to get rid of federal estate tax.

Capping the estate tax charitable deduction is a good idea and the GOP ought to work with the president.

© 2017 Newsmax Finance. All rights reserved.

 
1Like our page
2Share
Kleinfeld
Capping the estate tax charitable deduction is a good idea and the GOP ought to work with the president.
GOP, Obama, Estate Tax, Charitable Limitation
473
2015-04-08
Sunday, 08 Feb 2015 06:04 PM
Newsmax Inc.
 

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

NEWSMAX.COM
MONEYNEWS.COM
© Newsmax Media, Inc.
All Rights Reserved