Sure, Joe Biden isn’t a member of your family. Sure, politicians aren’t in your will or the wills of your parents. But many of them are still prepared to claim as their own even more wealth that doesn’t belong to them – through a devastating expansion of the so-called “death tax.”
Hank Adler reports for Reason that “Amtrak Joe” and his tyrannical train of acolytes have included in their “American Families” tax-and-spend “Plan” (AFP) a stunning increase in the tax on unrealized liquid and fixed capital gains.
Adler offers a good overview of the current inheritance tax landscape:
Current law excludes anyone with less than $11.7 million of net worth ($23.4 million for married couples) from any death taxes. Today, this means that $11.7 million can be passed along to family members without any reduction. But the AFP would subject taxpayers with a net worth far lower than $11.7 to a death tax. This levy would allow no deduction for any debt, whether that debt is secured debt on specific assets or personal unsecured debt.
But, of course, in the covetous eyes of American Marxists, that’s too much. They might not be able to define how much is “too much” for someone else to have acquired, or how much is “too much” to pass on to loved ones, but, whatever the “inequality” in wealth status, as long as collectivists can control others’ lives and take their stuff, any difference can be utilized as a wedge.
Any penny that was earned by someone else is forfeit.
And Biden has big plans for those pennies, so he has to take a lot more, through his pork-filled, tax-expanding “American Families Plan.”
Writes Adler, overall:
President Joe Biden's American Families Plan (AFP) would impose a capital gains tax at death while essentially doubling the capital gains tax rate. With a major exception for large investors, it would make these changes without grandfathering existing unrealized capital gains.
Under the AFP, the maximum federal rate on capital gains would increase from 23.8 percent to 40.8 percent.
There are, of course, byzantine “adjustments” within the huge spike of wealth consumption, so the 40.8 percent allows for three – just THREE – possible exemptions.
This would be calculated with two exemptions during life and an added third exemption at death. During life and at death, taxpayers would exclude $250,000 ($500,000 for couples filing jointly) on gains from the sale of a personal residence, and taxpayers would exclude up to 100 percent of income from any qualified small business stock gains. At death, there would be an added exclusion of $1 million of capital gains ($2 million joint).
And while some collectivists might see these “big numbers” and feel no qualms about stealing other people’s money, Adler puts the theft into practical and understandable terms to show how hard this could hit some beneficiaries after the death of a loved one.
For example, a taxpayer who has owned rental real estate for decades would have a tax basis after depreciation equal to the land value at acquisition. A long-owned residential rental property in Southern California could easily have a fair market value of $2 million and a tax basis of only $10,000. If a descendant had other gains in excess of the exemptions, a gain of $1,990,000 would result in a federal tax of around $800,000. If there was an existing 60 percent mortgage, the proposed tax plus the mortgage would sweep away 100 percent of the equity, leaving nothing for the family of the deceased.
And, while Biden repeatedly portrays himself to be “for the little guy,” his “American Families Plan” actually plays favorites with big-money investors:
(T)here is one exception to the lack of grandfathering of unrealized capital gains: the continuance of the 100 percent exemption for capital gains taxes from sales of qualified small business stock (QSBS). Such stock is issued by an active domestic C corporation, and it is most often found in the hands of very wealthy investors. The public has the opportunity to purchase stock in such a corporation only if there is an initial public offering, but the opportunity to buy it is rarely available to smaller investors. This is the domain of Wall Street venture capitalists.
Biden’s hypocrisy and his favoritism for Wall Street investors seems reminiscent of Karl Marx’s own.
Indeed, Marx bloviated in his Communist Manifesto (1848) that he wanted the state to confiscate all inheritances – even as he fought with great intensity to get the wealth promised to him in his father’s will.
But focusing on the hypocrisy of Biden and Marx is not the most important facet of this news story. The key is to recognize that all taxation is the seizure of something that belongs to another person. Joe Biden and other collectivists might not want to discuss it, but taxation is THEFT, and theft -- regardless of whether the government says it is okay (as the city of San Francisco has intimated by not prosecuting people who shoplift up to $900 worth of items) or the government engages in the act (as in taxation) -- is immoral.
Creating differences between people and creating categories of “who can inherit how much” plays Marx’s game; it accepts the immoral premise.
It’s not Joe’s money, and it doesn’t belong to “all of us” in some kind of childish “collective” government fantasy world.
Joe should focus on his own family, and leave us alone.