Run Hillary Run- bumper sticker thread

[Cataholic]

I am not following the people that post about their parents getting hit big time. Are you suggesting that your parents were somehow paying tax on someone else's estate? OR, are you saying that the decedent's estate was taxed, and that the amount owed on the assets of the estate were paid from the assets of the estate?

Again, I remain convinced that tax is there when the estate is significant. I have had estates over the minimums, and tax was owed....just, not usually.

And, Ceph, I am not picking on you. I think we ALL make statments that we think are right, and they might not be completely right, you know? No hard feelings, I hope. Just like to clarify some urban legends.

[critter crazy]

http://www.360financialliteracy.org/...tate+taxes.htm

GIFT AND ESTATE TAXES

If you give away money or property during your life, those transfers may be subject to federal gift tax and perhaps state gift tax. The money and property you own when you die (i.e., your estate) may also be subject to federal estate taxes and some form of state death tax. You should understand these taxes and when they do and do not apply, especially since the passage of the Economic Growth and Tax Relief Reconciliation Act of 2001 (the 2001 Tax Act) signed by President Bush on June 7, 2001. This law contains several changes (some of which are retroactive) that are complicated and uncertain, making estate planning all the more difficult.


Federal gift tax and federal estate tax--background
Under pre-2001 Tax Act law, no gift tax or estate taxes were imposed on the first $675,000 of combined transfers (those made during life and those made at death). The tax rate tables were unified into one--that is, the same rates applied to gifts made and property owned by persons who died in 2001. Like income tax rates, gift and estate tax rates were graduated. Under this unified system, the recipient of a lifetime gift received a carryover basis in the property received, while the recipient of a bequest, or gift made at death, got a step-up in basis (usually fair market value on the date of death of the person who made the bequest or gift).

The law substantially changed this tax regime.


Federal gift tax
The 2001 Tax Act increased the applicable exclusion amount for gift tax purposes to $1 million for 2002 and each year thereafter (even though the applicable exclusion amount for estate tax purposes increases in years 2004 through 2009). The top gift tax rate is 48 percent in 2004, 47 percent in 2005, 46 percent in 2006, 45 percent in 2007 through 2009, and 35 percent in 2010 (the top marginal income tax rate in 2010 under the 2001 Tax Act). In 2011, the gift tax rates revert to pre-2001 Tax Act levels. The carryover basis rules remain in effect.

However, under the new law, many gifts can still be made tax free, including:

• Gifts to your U.S. citizen spouse (you may give up to $114,000 in 2004 tax free to your noncitizen spouse)
• Gifts to qualified charities
• Gifts totaling up to $11,000 to any one person or entity during the tax year, or $22,000 if the gift is made by both you and your spouse (and you are both U.S. citizens)
• Amounts paid on behalf of any individual as tuition to an educational organization or to any person who provides medical care for an individual

State gift tax may also be owed if you are a resident of Connecticut, Louisiana, North Carolina, Tennessee, or Puerto Rico.


Federal estate tax
Under the 2001 Tax Act, the applicable exclusion amount for estate tax purposes increases in steps until it reaches $3.5 million in 2009 (the applicable exclusion amount for gift tax purposes remains fixed at $1 million). Top estate tax rates are 48 percent in 2004, 47 percent in 2005, 46 percent in 2006, and 45 percent in 2007 through 2009. The estate tax (but not the gift tax) is repealed in 2010, but the estate tax applicable exclusion amount and rates revert to pre-2001 Tax Act levels in 2011.

When the estate tax is repealed in 2010, the basis rules will be changed to those similar to the gift tax basis rules. The step-up in basis rules return in 2011.

Many of the estate tax deductions remain in effect, and some have even been improved, but the qualified family-owned business deduction has been eliminated for persons dying after 2003.

Note: For estates that have previously elected the qualified family-owned business deduction, the recapture rules continue to remain in effect until the 10-year recapture period has expired.


Federal generation-skipping transfer tax
The federal generation-skipping transfer tax (GSTT) taxes transfers of property you make, either during life or at death, to someone who is more than one generation below you, such as a grandchild. The GSTT is imposed in addition to, not instead of, federal gift tax or federal estate tax. You need to be aware of the GSTT if you make cumulative generation-skipping transfers in excess of the GSTT exemption, which is $1.5 million (in 2004 and 2005). A flat tax equal to the highest estate tax bracket in effect in the year you make the transfer is imposed on every transfer you make after your exemption has been exhausted.

Some states also impose their own GSTT.

Note: Starting in 2004, the GSTT exemption is the same amount as the applicable exclusion amount for estate tax purposes.


State death taxes
The three types of state death taxes are estate tax, inheritance tax, and credit estate tax, which is also known as a sponge tax or pickup tax. The estate and inheritance taxes are known as basic taxes, and some states impose one of the two. All states impose the credit estate tax, either alone or in addition to a basic tax.

[sparks19]

That still doesnt sound right to me. lets say everyone is paying....oh say, 40% accross the board. Those that make 2000 a month (averagish for the military) are going to pay less than those who make 10000 a month because that is how percentages work....you're saying those who make 10000 should get charged what? 60%. Because they make a more...again, that doesnt strike me as fair, or right.

Or, we could do something useful like getting rid of the death tax or the marriage penalty....that might help some people out.

~Ceph

THANK YOU.

People that make more money are already paying MORE taxes then the middle or lower class folk. Like stated above 40% of nothing is NOTHING, but 40% of a lot is A LOT.

So do you think we should tax them enough so that it brings them down the the middle and lower class level? should we all make the same money? Thats what it sounds like to me.

I said that lower income people are lazy? LOL hmmm don't recall saying those words but ok. I am the middle lower class people I refer too. I COULD have gone to college for a better career but instead I want to do something that I like... not just something that makes me money. My husband makes a pretty decent wage but he worked HARD for it. he spent 12 years inthe army and got his education while in the army. I have a friend who was inthe marines for 12+ years. he never took advantage of the schooling option and now he whines and complains that uncle sam isn't giving him a hand out for his service. AH well he had a perfectly good opportunity to get a good education so that he could have a decent job when he got out but he didn't and that is no one's fault but his own.

You don't get a CEO position as soon as you step into a company. it takes years and years of hard work to move up to such a position and I think they deserve the money they make.... they earned it. But screw them, I don't want anyone making more than me so lets tax them so that they can only make as much as I do

Sorry, whether it is luck, hard work, or whatever.... people should NOT be punished for being successful. In this nation in this day and age everyone has an opportunity to succeed. Some do and some don't. life's tough.... wear a helmet. I just refuse to believe that it is right to charge more taxes to those that are lucky enough to make the money they do. YOu know these CEO's don't work a 9-5 monday to friday job like the rest of us. they usually have to put in 60-80 hours a week despite what you believe about the wealthy.

My uncle is a regional manager for McDonalds. YES McDonalds. It was his first job. he started out minimum wage but he stuck with the company and now he gets a big fat pay cheque because he worked hard to get where he is. Now he can provide his family with everything he wanted to be able to give them. A nice home, nice stuff, and loving parents. he has 4 children. So should he be taxed much more than the rest of us? I don't think so. He put up with the minimum wage, the bull crap of being on the bottom of the "food chain" but he stuck it out to get where he is. I see so many people that say "UGh I quit this job because they weren't paying me what I think I should be paid. or they didn't treat me like they treat the higher ups" or what have you. You have to work to move up. We all have to do things we don't like in order to make the money we feel we deserve.

As for the death tax.... I hate that crap. I think the death tax should be done away with. the government has already taxed the money and those goods once.... it is not right to tax it again. IMO.

[Ceph]

lol, thank you...you said it better then me...it keeps on getting garbled when I try to say things. My grandad's estate was worth over 1m because he was a successful doctor and had his own practice and a house in an area that was rapidly growing. After Dad inherited the house and Uncle Max inherited the practice there was nothing left at all. I dont know how it is in other states, but MD has a lower exclusion than alot of other states.

And I dunno...its not really fair that it got taxed while he was alive and then taxed again.

and there, I have said my piece....It may be different in other states, but at least that is how it is here.

[sparks19]

lol, thank you...you said it better then me...it keeps on getting garbled when I try to say things. My grandad's estate was worth over 1m because he was a successful doctor and had his own practice and a house in an area that was rapidly growing. After Dad inherited the house and Uncle Max inherited the practice there was nothing left at all. I dont know how it is in other states, but MD has a lower exclusion than alot of other states.

And I dunno...its not really fair that it got taxed while he was alive and then taxed again.

and there, I have said my piece....It may be different in other states, but at least that is how it is here.

My husband and I were talking about this. When his dad passes away he has a substantial amount of money saved and in his insurance to give to his two kids and his wife. He earned quite a decent amount of money during his lifetime. he was/is a nuclear technician. But they didn't live a life of luxury. He used what he had to to provide for his family. They had good food a nice home and things of that sort but every extra cent went into a fund to leave to his family when he passes. (should we tax him extra because he makes more money than the rest of us even though that money is going to provide for his family when he passes on? Seems many of you think so. YES let's gyp his family so that we don't have to pay as much tax as him)

now he has already paid taxes on that money. Actually twice. he pays taxes on the funds he has saved up and he paid taxes when he first got the money in his pay chq. NOW they want to tax it again when he passes on and they deal out his estate. Why should the government be able to tax it three times? the tax on that money and those goods has already been paid. it is wrong to take money from his family that has already been taxed just because it is "changing hands"

[Ceph]

lol, again, hypothetical numbers....not real...fake...there to try and put accross what I was saying.

And I dont pretend to be an accountant either (or very good with numbers...the military helps me keep it stimple)...most of the kind of accounting I know if corporate accounting, and I dont know that all that well either. I just think that everyone should get taxed the same....thats it....nothing more...I promise.

Edit : just on a side note - the last drill I had was a MUTA - 2...made half of what I usually make...my yearly income from the guard is about 3K, and I got 22% removed in taxes (FICA, State, and Federal)....but because they are paying for college I limp by on the quite well actually. I dont know if I am crazy or not, but I do know math...and I am pretty sure those tax brackets dont fit on me so well.

[sparks19]

50K is limping by? Yikes. then we are definately in the lowest tax bracket. Of course right now my husband is the only one that makes money. i work for free rent since I rent my boss's house. I work enough hours to pay the rent and I just don't get a pay cheque. Of course, due to "child" support (no children involved but the ex is very much like a child lol) my hubby is bringing home far less than that. around 55k a year minus $550 a month for alimony until June. but I wouldn't consider myself poor by any means. We live quite a comfortable exsistence. Of course most of that money is also going towards more immigration stuff and dr;s fees for prenatal care since I don't have health insurance here. but even after all that we are still living comfortably and wouldn't consider us downtrodden or poor or less fortunate.

the bills get paid and we still have enough to do the things we enjoy. of course not all of those things cost money. We also don't own or need a 65,000 dollar vehicle, a pool, a huge house with all the trimmings to be happy.

that is one thing I have noticed lately. In fact, a few months ago (I don't know the specifics) but after the PA senate gave themselves a HEFTY pay raise... everyone raised heck because they make enough already. You know what their defense was? We need to make this much because we have to send our kids to college and we have to survive. instead of redistributing the unused tax dollars that I feel are rightfully ours and should be redistributed they gave it to themselves.

that just shows how out of touch with the real world these people are. If they need to make that much money to survive how do the rest of us survive and send our kids to college. Perhaps if they got rid of their summer homes.... their big expensive vehicles..... and lived a normal exsistence they wouldn't have to make that much to "survive"

[Ceph]

My dad thinks its punishment - and he is helping to support (with our assitance too) two kids going to college on a little over 45K yearly....He's paying plenty of taxes, and like me (lol, I know parental raising has something to do with how you view the world).

Believe me, its pretty easy to get by on 20 and 30K.

Edit : oops, I was wrong, He makes closer to 4, sorry about that...it just gets taxed way down (house, FICA, Federal and State)....There are a few places in my area - mostly the county housing that I actually wouldnt have to much trouble surviving on a military paycheck...it is possible...just in the right places.

[sparks19]

Sparks,

you keep saying that but no-one is suggesting any such thing!!! And no one (but you) classifies this practice as punishment. I have done well some years and not so well others - in the more prosperous years, I had no problem paying a slightly higher % of my good fortune. And in my leaner years, I have appreciated the slight reduction I paid as a percentage. I am not sure why people keep putting out numbers like 50 and 60% and suggesting that those who are making 30,000 get away with not paying anything. The range is more like 25-35%. I could go on, but I will hold off for a maybe later post.

then I must be misinterpreting the posts saying that rich people should pay more in taxes then the little people. I was just using those numbers as an example. Just saying that if I am taxed 40% (not saying that I AM just using the number as an example) I don't think it is fair that the next higher up bracket should pay 50% or the next highest should pay 60%. Again these numbers are only for examples. Again, if we are going to make people who are better off pay the highest percentage then why don't we just send them our medical bills. Everyone should pay the same percentage. If you make 10,000 your percentage will equal out to a small fraction. if you make 1,000,000 your percentage will equal out to a lot more money going into taxes. they already pay more then the lower class. why should they pay even MORE than that. LOL what if those people in the higher tax bracket have 12 kids to support? should they pay less tax then?

this is the impression I have gotten from previous posts. that those who make more money should pay a higher percentage of tax. I disagree.

Ceph, it really is. I keep seeing people say that they ONLY make 20,000 and it's almost impossible to get by. How is that possible? In all my life I don't think I have ever had a job that I made more than 25,000 per year. I am able to survive just fine on that. You just have to live a more moderate exsistence. YOu don't go out and buy the most expensive care... or the biggest house. Live by your means and 20,000 provides a fine living.

My mother (a single mother) never made much money yet I always had a nice house to live in, clean clothes on my back and good food on the table. What more do you need?

[Ceph]

^
||

what she said

[borzoimom]

As far as making 25 grand a year as being comfortable, in this area- look at these average household earnings. No way in the world could anyone survive on 25 grand in this area- no way.. And Loudon county is one of the highest paid, and fastest growing counties in the US...
A person making 25 grand in like Fairfax county would be all but bankrupt- where as I am sure there are other parts of the country that would work..http://www.co.loudoun.va.us/business...y_2004/b_2.pdf

[Pembroke_Corgi]

then I must be misinterpreting the posts saying that rich people should pay more in taxes then the little people. I was just using those numbers as an example. Just saying that if I am taxed 40% (not saying that I AM just using the number as an example) I don't think it is fair that the next higher up bracket should pay 50% or the next highest should pay 60%. Again these numbers are only for examples. Again, if we are going to make people who are better off pay the highest percentage then why don't we just send them our medical bills. Everyone should pay the same percentage. If you make 10,000 your percentage will equal out to a small fraction. if you make 1,000,000 your percentage will equal out to a lot more money going into taxes. they already pay more then the lower class. why should they pay even MORE than that. LOL what if those people in the higher tax bracket have 12 kids to support? should they pay less tax then?

this is the impression I have gotten from previous posts. that those who make more money should pay a higher percentage of tax. I disagree.

Ceph, it really is. I keep seeing people say that they ONLY make 20,000 and it's almost impossible to get by. How is that possible? In all my life I don't think I have ever had a job that I made more than 25,000 per year. I am able to survive just fine on that. You just have to live a more moderate exsistence. YOu don't go out and buy the most expensive care... or the biggest house. Live by your means and 20,000 provides a fine living.

My mother (a single mother) never made much money yet I always had a nice house to live in, clean clothes on my back and good food on the table. What more do you need?

Well, the rich DON'T pay a higher percentage of their income in most taxes, that is the point. For example, SS taxes are only taken out of the first $90,000 or so of your income. I'm not sure exactly what the figures are, but I think they take roughly 10% for SS. That means, if I make $25,000/year I pay on 100% of my income, etc, but if I make $250,000 a year, I pay SS tax on roughly 36% of my income. Is that "fair?" No.

And most rich people have such good tax lawyers, etc, I'm sure that very few pay "fairly." Also, most truly needy people probably don't pay many income taxes, if any at all. It's the middle class that carries the burden- is that "fair?"

Also, I'm not going to make judgments on how much money per year is "enough," but keep in mind, $20,000 in Pennsylvania goes a lot further than $20,000 in California.

[Ceph]

I think the problem isnt so much the federal taxes though now that I look at it....It's mostly FICA taxes...For the first time I really Looked at my LES and FICA and State taxes where what was taking the majority out of my pay.

Now, I need help...can someone tell me how the FICA taxes change from Tax bracket to bracket, because that I really dont know.

[borzoimom]

sorry all- here is the link- I added it in edit.. Someone making a 100 grand in northern virginia with the price of housing and cost of living, to be taxed the same as someone making like a 100 grand in other parts of the country.. Is flat out stupid.. http://www.co.loudoun.va.us/business...y_2004/b_2.pdf

[sparks19]

50K is limping by? Yikes. then we are definately in the lowest tax bracket. Of course right now my husband is the only one that makes money. i work for free rent since I rent my boss's house. I work enough hours to pay the rent and I just don't get a pay cheque.

I should reword that previous statement. Do not get me wrong... i technically DO get a pay cheque... so I do pay taxes. I just don't see the pay cheque. it is immediately signed over to my boss. I don't even cash the cheque myself.