Myths and Facts About the Estate Tax

Myths; All companies are subject to the estate tax.

FACT: only families, individuals, pay the estate tax; public companies and regular corporations do not pay the tax.

Myth: Farmers are hurt more than other businesses.

FACT: Other businesses like manufactures also have illiquid assets and are just as harmed, and do not have some of the special exemptions that farmers have in the tax code.

Myth: The estate tax hurts small businesses.

FACT: 66% of all businesses are already taken care of with the existing $10 million per couple exemption, but small businesses all want to grow their business to large businesses. This is especially true for black, women, Hispanic and other minority business owners who want to pass the business on to the next generation; many of them are only in first generation.

Myth: It cost too much in “lost tax revenue” to help “ALL” businesses.

FACT: If the rate of tax was reduced to 20% it would result in a loss of $130 billion which would help all family businesses.

Myth: Without the estate tax families will not make charitable donations.

FACT: Families will have more incentive to give during their lifetime and will be able to continue to give to local communities since they will not have to sell the business to pay the estate tax.

Myth: The country can’t afford the loss in revenue

FACT: Economic growth – will unlock $50 billion per year in capital gains, (per CBO estimate), by eliminating the step-up in basis which is not needed if there is no tax.

Myth: The American voter wants to keep the estate tax.

FACT: After presented with all the facts about the death tax and arguments for both sides, 52% of Americans think the tax should be eliminated!

Myth: Only the very wealthy have to worry about the estate tax.

FACT: 88% of all estate tax returns filed in 2016 are from estates of $50 million or less. So, the smaller estates are the ones spending all the money with accountants and attorneys to file the tax returns necessary. 

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