Culture wars out of the closet

[Tybee]

I think my piano example was a little skewed-- a 1930 Baldwin grand cost 1450, so a Mason Hamlin was probably no more than 1750. And no, I don't think the government should get a cent in taxes if you inherit the piano and sell it for 50k.

[ApatheticNoMore]

And no, I don't think the government should get a cent in taxes if you inherit the piano and sell it for 50k.

then why should it get a cent in taxes if say you work for a year and earn 50k? It's the same 50k either way, if you went out and spent it noone is going to distinguish between the two.

[jp1]

Actually, those gains *were* taxed, and they are taxed upon each successive death. They were taxed as part of the estate tax, the marked-to-market valuation included in the valuation of the estate during the calculation of the estate tax due. The rate paid however was 0%, because a certain amount of each estate is *exempted*, much as a certain amount of your personal income each year is *exempted* when you do the final calculations.

Then we need to revise the estate tax so that it doesn't have a 0% rate for 699 out of 700 people.

[jp1]

I think my piano example was a little skewed-- a 1930 Baldwin grand cost 1450, so a Mason Hamlin was probably no more than 1750. And no, I don't think the government should get a cent in taxes if you inherit the piano and sell it for 50k.

What if you inherit a piano store and sell 20 pianos for $50,000 apiece? Should you still not have to pay tax? Or are pianos sold in a store different from pianos sold on craigslist or ebay?

[ToomuchStuff]

What if you inherit a piano store and sell 20 pianos for $50,000 apiece? Should you still not have to pay tax? Or are pianos sold in a store different from pianos sold on craigslist or ebay?

Piano's sold in a store, were bought by a business, with a tax exemption, as inventory. The tax is collected at the time of sale, from the purchaser. That sales tax has been paid already on previously owned, privately sold ones.
Also, depending on how the business is setup, while it and the owners taxes are linked, they are not the same. (sole proprietorship, has different issues then a corporation which could have several family members, etc)
Somethings forgotten in several arguments. Innocent until proven guilty. Not everybody keeps good records, or are mentally all there at the end, so finding out what the basis for a piano bought long ago is, and if it had options (extra inlay, real ivory, etc) that added to its cost, would be a MAJOR burden for both the grieving person, and for the government workers trying to get the income. So are the fed's supposed to take over antiques roadshow for all these "dues"?
If you don't think your paying too much in taxes, why wouldn't you just write them an extra check?
I believe it would take an amendment/modification of the constitution to go from our currency, to something that the government would probably like. Think about all the electronic transactions taking place and digital payments (card, online billing, etc). The government could then implement a pay taxes on all purchases, new and used, including people who try to pay with cryptocurrency, and you might see a bigger barter economy spring up in retaliation. That would even cover things like electronic filings of deeds, personal property, etc. (and you would have to come up with the money to obtain the property)
That would hurt more American's then the ones your worried of, who would "invest" in out of the country things, to make that money only taxable on the electronic part they pull in.

As for the original posters first article, while I understand the argument of people would like to live in a leave it to beaver, or such world, that isn't reality, anymore then reality tv, which people strive to be. (former neighbor who achieved their dream of being on Springer) As for Kooks, that does look like something David Duke would have had on his presidential run years back.
WSJ isn't available to non digital subscribers, which is a LOT of people.

[jp1]

Piano's sold in a store, were bought by a business, with a tax exemption, as inventory. The tax is collected at the time of sale, from the purchaser. That sales tax has been paid already on previously owned, privately sold ones.
Also, depending on how the business is setup, while it and the owners taxes are linked, they are not the same. (sole proprietorship, has different issues then a corporation which could have several family members, etc)

But after the store sells the piano, assuming that they sold it for more than they purchased it for, there's also income tax due on the gain.

If you don't think your paying too much in taxes, why wouldn't you just write them an extra check?

It's not that I think I specifically should be paying more, it's that I think estates across the board should be paying more. And, frankly, my dad didn't arrange his assets with tax avoidance in mind. When he retired he reallocated into almost entirely conservative blue chip dividend paying stocks and then never touched anything again. By the time he died 20 years later his brokerage account was almost 50% cash, all of it dividend income that was taxed during his lifetime. He could have pursued a strategy of buying growth stocks that didn't pay dividends and avoided a lot of his annual income tax bill but chose not to for other reasons.

[ToomuchStuff]

But after the store sells the piano, assuming that they sold it for more than they purchased it for, there's also income tax due on the gain.

Business income and as stated, that in part depends on how the business is setup, as well as estate tax from business dispersal (more complicated then just an estate).


It's not that I think I specifically should be paying more, it's that I think estates across the board should be paying more. And, frankly, my dad didn't arrange his assets with tax avoidance in mind. When he retired he reallocated into almost entirely conservative blue chip dividend paying stocks and then never touched anything again. By the time he died 20 years later his brokerage account was almost 50% cash, all of it dividend income that was taxed during his lifetime. He could have pursued a strategy of buying growth stocks that didn't pay dividends and avoided a lot of his annual income tax bill but chose not to for other reasons.

And?
His choice, wasn't your money, not your choice.

[jp1]

And?
His choice, wasn't your money, not your choice.

Yep. And I'm good with it. Especially since his thought process was probably to make sure that my mother would have easy to access, steady income in the actuarially likely scenario where she outlived him. He took good care of our family his whole life and it's kind of cool to know that he planned to continue doing so after his death.

I would have been equally good with things if he and mom had decided to spend retirement traveling around the world and spending all their money. Dad's the one that worked for it, not me.

[bae]

Then we need to revise the estate tax so that it doesn't have a 0% rate for 699 out of 700 people.

It's not that I think I specifically should be paying more, it's that I think estates across the board should be paying more.

Why?

[LDAHL]

Then we need to revise the estate tax so that it doesn't have a 0% rate for 699 out of 700 people.

If the current law excludes the first $5.5 million or so from an individual's taxable estate, how much would you reduce the exclusion to tax more dead people? I would think going much below that would make it difficult to pass family farms and businesses between generations.

Or is this one of those "Hoarding the American Dream" issues, like 529s or the mortgage interest deduction, that makes it easier to stay in the upper middle class and puts people trying to break in at a disadvantage? Are we trying to achieve more of a generational reset here?