A Simple Estate Tax Collection Method Allowing Same Cash Flow to Treasury and Saves Jobs, Farms and Businesses for Americans
The U.S. House Small Business Committee held a hearing this month to assess the impact the estate tax has on private businesses across the United States. The timely hearing comes as the reimposition of the pre-2001 estate tax is scheduled to occur at the end of this year. This means the estate tax will revert to 55% with a $1 million dollar exemption. Even under current law, many businesses, farms, and ranches are unnecessarily liquidated, causing huge job losses, in order to pay the tax liability upon an owner’s death. Many Americans lock away assets in unproductive trusts or unnecessarily high amounts of life insurance in anticipation of the feared estate tax.
Americans Standing for the Simplification of the Estate Tax (ASSET) calls for a change to the current collection method. “I believe that the answer lies between the public outcry to “end the death tax” and the calls from others on the political spectrum to impose significant taxes on those who are fortunate enough to die with vast amounts of accumulated wealth” explains Jack Fitzgerald, founder of ASSET in submitted testimony.
This is where ASSET offers a way out. The ASSET proposal would simplify the tax system by replacing the current collection methodology and substituting as an interim measure a pay-as-you-go, revenue neutral alternative collection mechanism that will, over time, vanish thanks to the anticipated windfall of capital gains tax receipts. Additionally, the proposal will eliminate the need to shelter assets in unproductive trusts, thus unlocking those monies to help the economy, without needing support from the U.S. Treasury.
Congressman Bartlett, a senior member of the House Small Business Committee, said, “The current structure of the estate tax forces the sale of many family-owned businesses, farms and ranches. The estate tax kills jobs in our communities and destroys families’ dreams of building on the success of previous generations. I commend ASSET for the proactive and innovative thinking to find common sense alternatives that support rather than cripple family-owned businesses.”
ASSET is a coalition of private businesses, family farms, ranches and individuals founded in order to change the collection method for the Estate Tax that first stops the harm caused by job losses and business closures.