Thune Reintroduces Bill to Repeal Death Tax
-Permanently abolishes punitive tax on family farms, ranches, businesses-
WASHINGTON, D.C.—U.S. Sen. John Thune (R-S.D.), member of the tax-writing Senate Finance Committee, today reintroduced legislation to permanently repeal the federal estate tax, better known as the death tax, to finally put an end to a punitive tax on family farms, ranches, and businesses upon the death of an owner. Thune’s bill, the Death Tax Repeal Act of 2015, is identical to legislation introduced in House of Representatives by Rep. Kevin Brady (R-Texas). The House Committee on Ways and Means will be marking up Brady’s companion bill today in committee. Thune also introduced an amendment to the Senate’s Fiscal Year 2016 Budget Resolution to create a deficit neutral reserve fund to eliminate the federal estate tax, or death tax. The Senate is expected to vote on Thune’s amendment later this week.
“Death should not be a taxable event,” said Thune. “For too long the federal government has forced grieving families to pay a tax on their loved one’s life savings that has been built from income already taxed when originally earned. Currently more than 70 percent of family businesses do not survive to the second generation, and 90 percent of family businesses do not survive to the third generation. According to a study by former CBO Director Douglas Holtz-Eakin, repealing the death tax would create 1.5 million additional small business jobs and would shave almost a percentage point off the unemployment rate. This tax punishes farmers and entrepreneurs for a lifetime of hard work. I will continue to work in Congress to see a permanent end to this unfair tax.”
“I am proud to join Senator Thune in introducing the Death Tax Repeal Act, which will finally abolish this unfair, anti-family tax, and I appreciate his leadership on this issue,” said Senate Majority Leader Mitch McConnell. “The death tax unduly burdens American families by taxing assets that are handed down from generation to generation, like family farms or small family businesses. It is the federal government’s final insult to tax your family when you have already paid taxes on your property throughout your life. The thought of having to visit the IRS and the undertaker on the same day is an absolute outrage. This is wrong and it’s why I have consistently supported legislation to eliminate this burdensome tax.”
“The death tax unfairly targets hardworking American families, small business owners, and farmers that have already been taxed all their lives,” said Senate Finance Committee Chairman Orrin Hatch. “Fortunately, there is bipartisan support to put an end to this burdensome tax once and for all. It’s time this tax be repealed so that families can pass down what they’ve worked so hard to build over a lifetime to their children.”
Thune’s bill is supported by the American Farm Bureau Federation, Associated Builders and Contractors, National Association of Manufacturers, National Federation of Independent Business, 60 Plus Association, Americans for Tax Reform, Club for Growth, National Black Chamber of Commerce, International Franchise Association, National Taxpayers Union, American Conservative Union, Family Business Coalition, and many others.
Thune’s bill is cosponsored in the Senate by Sens. Lamar Alexander (R-Tenn.), Kelly Ayotte (R-N.H.), John Barrasso (R-Wyo.), Roy Blunt (R-Mo.), Dan Coats (R-Ind.), Thad Cochran (R-Miss.), John Cornyn (R-Texas), Mike Crapo (R-Idaho), Ted Cruz (R-Texas), Mike Enzi (R-Wyo.), Jeff Flake (R-Ariz.), Cory Gardner (R-Colo.), Chuck Grassley (R-Iowa), Dean Heller (R-Nev.), John Hoeven (R-N.D.), Johnny Isakson (R-Ga.), Mark Kirk (R-Ill.), Mike Lee (R-Utah), Mitch McConnell (R-Ky.), Jerry Moran (R-Kan.), Lisa Murkowski (R-Alaska), Pat Roberts (R-Kan.), Mike Rounds (R-S.D.), Marco Rubio (R-Fla.), Pat Toomey (R-Penn.), and David Vitter (R-La.).
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OK. I am really trying hard to have an open mind on this subject but I have yet to hear how it is fair for the very wealthy not to pay taxes generation after generation if this is passed. I pay taxes and most of you do too. Perhaps 40 percent of total income.
There is already a five-million dollar exemption before taxes are paid on inheritance. Without inheritance taxes above that amount, millionaires and billionaires will just keep the vast majority of their assets in stock and other investments until death so they end up paying very little in income tax and no inheritance taxes.
Additionally, they do not have to pay even one percent of their income in social security taxes because that is capped.
Upon inheriting the money, their children can buy their yachts and homes and keep a few million spending cash. Then, they put the rest in investments for their own kids. On and on.
So. My Senators are OK with me paying 30 to 50% in total taxes but think that billionaires need only pay 2 or 5 or 10%? For hundreds of years?
Sure, an argument can be made that reducing taxes on anyone creates jobs. Duh. But really?
You will be forcing all of us to pay more so as to reduce the taxes on those fortunate souls who inherit money in excess of five million dollars. The rest of us will just have to keep paying. We’ll pay before and after the death of our loved ones because we just weren’t rich enough.
I had a conversation with someone who said, “Well, it’s not fair that a farmer buys land at $500/acre and then the kids inherit, tax-free, when the value has gone up to $5,000/acre.”
I replied, “So what if someone was fortunate enough to make a lot of money, put it in CDs and money market accounts, and then he pays tax on the interest on the money he already paid tax on; then, if the money he leaves to his kids is over the limit, they get taxed on the money and interest that was already taxed, is that fair?” (Crickets chirping)
I don’t think the government should give you one more kick in the backside as you go out the door.
I am for a fair or flat tax and also for lowering government spending, which means reducing government power, so the Dems will never go for that.
democrats greatly rely on two things from dead people – their assets and their votes. good luck with that.
Democrats know two things that we apparently do not. Governors don’t win many votes by lowering the minimum wage and Senators need to represent the people who elected them. There aren’t many billionaires in South Dakota. Hello.
in the current congressional environment, the introduction of this and many bills has the face value of the bill itself, and also the aggregate weight of the mass of bills introduced that run counter to the political opposition. i realize you’re bought into class warfare on this one, but i’m happy to have a bill like this take its place among the many that this administration is going to have to bat down and stall for their own ideological reasons. if you’re a true-blue “98-percenter,” there’s nothing i can say to sway you anyway. thanks.
You can sway me if you can tell me that the rich will pay at least the same or higher rate than the middle income folks. If they repeal the estate tax, you can’t say that now can you? Not a chance.
that’s not swaying, that’s your position.
Let’s hear from every single reader of this blog who will benefit from eliminating the inheritance tax above 5.3 million dollars. C’mon. There’s got to be at least one of you.
Now ask yourself what the hell our Senators are doing spending valuable political capital on furthering the wealth of so few well off people.
the death tax already doesn’t affect the ultra-rich using foundations and other mechanisms to protect their accumulated wealth. this does affect millionaires who have worked their butts off to build a great business and truly penalizes the families who would otherwise inherit and maintain the business, whether it’s a family ag operation or a manufacturing plant. let’s yell about the ultra rich then screw the sort-of rich since we can’t get to the ultra-rich anyway. and why are you so focused on liberating other peoples money?
Hard work is taxed at earnings of forty thousand or fifty thousand dollars a year. But inherit $50 million or a thousand times more and…No Tax!
Maybe that Soros guy paid tax on that $50 billion some eighty years ago so now, you argue, it should forever be tax free. (Note… “maybe”)
This death tax repeal is a simple attempt to use a family’s grief as justification for outrageously unfair tax policy.
nobody can get at the really big money you keep talking about. you talk about multimillionaires and billionaires skating, then talk about a million here or a million there being subject to the tax. or do you think middle income is still wedged into the 10K to 80K bracket?
You say: “nobody can get at the really big money you keep talking about”.
Not true. It appears that our Senators don’t want to. That is the problem.
you’re missing the point. there are already laws and the ultra rich aren’t affected. the proposal is to eliminate the law for its effect on the lesser persons who are hurt by it. you are dodging any rational discussion and you know it.
you’re a shill for the ultra rich but you won’t admit that either.
I know a bunch of people who will benefit but they all voted for Elizabeth Warren.
Is there a rational explanation for that? Like wealth causes insanity?
What percentage of estates even have to pay the inheritance tax? I have read that it is less than one percent but, regardless, it has to be small. So, is this a case where our Senators literally represent the richest 1% as Democrats charge? Well, it certainly isn’t me.
cool. you’re a 99 percenter. even better.
Just think about this. What is the public seeing right now? They see a Governor reducing the minimum wage and they see our entire Congressional delegation trying to virtually wipe out the tax burden of millionaires and billionaires so the rest of us have to pay more.
Are we really this clueless?
define ‘we’
Thune follows the money,
I agree in principle with Jommy James.
Government in total should be supported by a broad range of sources- income, property and sales taxes. This insures everyone pays taxes to support their government.
Additionally, if you give me a choice to pay higher taxes now and have none due upon death or lower taxes now and some paid at death. I prefer the latter. Thus support a death tax.
Further, since my heirs didn’t earn the money, it is their “capital gain.” Thus, I support a death tax equal to the capital gain rate.
i don’t think ‘lower taxes now’ was on the menu yet in washington. but the capital gain equivalency sounds acceptable. (like i’m leaving anyone a million bucks)
The sub-headline for this article: “Permanently abolishes punitive tax on family farms, ranches, businesses”
For clarification, remove the word “punitive”.
thank you all for your wonderful comments, perspectives and input on these issues. thanks much.