Get Ready to Throw Momma from the Train
It’s coming closer:
Once the tax expires, those inheriting estates after Dec. 31 will have to pay capital gains taxes on any asset sold. The cost will be based on the original price of the property, which could mean record-keeping headaches and bigger tax bills for some people.
“If we do not extend our estate tax law, all taxpayers, all heirs will be subject to massive, massive confusion in trying to determine the value of their underlying asset,” Baucus argued on the Senate floor.
Fortunately, unlike Health Care “Reform,” this only affects a few people:
The estates of about a quarter of 1 percent [0.0025 — ken] of Americans would be subject to the tax under the House bill, according to the the Brookings Institution-Urban Institute Tax Policy Center.
I guess someone hasn’t blown Joe Lieberman enough this week.
The Democrats insist that in early 2010 they will revisit this and make the “new” estate tax retroactive to 1/1/10. And, although very few estates would be subject to the estate tax in theory all heirs would be subject to the capital gains tax that would replace the estate tax. Your parents die and leave you their home which they purchased for $35,000 in 1970 and is now worth $335,000…you owe the Treasury $45,000. Sounds like fun!