The Democrats opposed the proposal saying that it would only benefit the very wealthy. I believe that they are wrong. 

It will actually hurt many people. It seems to me that the elimination of the basis step-up at death would result in substantially greater capital gains taxes than would be saved in estate taxes. 

Clearly this would be the case for estates (with proper planning) of most couples up to about $1.3 million and would probably be the case for most estates (with proper planning) up to $2 million or higher. Just think of all the estates containing homes that have appreciated in value. The $500,000 Section 121 exemption wouldn't apply to the estate or to the heirs. 

I just don't understand why the Democrats are not providing all the details. They could really hammer the Republicans on this. I have to assume that they really don't understand the legislation. By the way, I'm a registered Republican. 

Steve

<A Taxpayer's Opinion of the Estate Bill-That-Didn't-Pass>

Taxmama, you are the most informative, important tax person in the world. I will go back and re-read the new "veto'd" estate tax information.

My father is wealthy because he has invested wisely. As a truly middle class family, I think that the abolishment of inheritance tax is GGGGGrreeaat!!! 

Isn''t that what we're talking about or did I miss the boat? A hundred dollars dad will read this. 

Janet 

(See Dad, she loves you - and not just for the money <g>)
Well, this Mama is stubborn ... and, luckily, I have a partner who keeps digging. He found some more data about that Estate tax bill this week ... Seems I was wrong.

There actually WAS a provision for estates under $3,000,000 to keep that stepped-up basis and other benefits they have now. Maybe the bill wasn't so bad after all? And that may explain why Democrats were not crowing about it.

But, if that's the case, that Estate Bill would have been a benefit to most people, not just the 'wealthy.' Why DIDN'T they override the veto? Now, Steve's Republicans will have a good issue. The actual tax lost in revenues would not have been significant. 

However, I will admit, the loss in revenues to attorneys and tax professionals if such a bill passes IS substantial. So <sigh> I suppose someone comes out well if we keep the estate taxes.

Eva

There is no guarantee that we'll have room for all your questions, so we try to address those issues that will help the most people. 

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 Have a wonderful holiday.       Wendy Gaska

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Updated September 8, 2000

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