Weekly TSP Talk Poll

[Frixxxx]

Poll: http://www.websitetoolbox.com/cgi/view/poll.cgi?username=tsptalk&showPage=1&id=23783

I'm glad to see the polls up every week. Thanks Tom!

But I think this week is an exception. The estate tax issue is complex. Many people like us put money into tax deferred accounts to shelter it when our income is reduced after retiring so that we can be taxed at a lower level. The problem comes down to that monies that are sheltered have to, sooner or later, be taxed to support our spending.

This is a horse/cart argument. :notrust: (sarcasm smilie)

We wouldn't need an estate tax if we weren't spending it faster than it comes in. Or we wouldn't even need these taxing schemes if it weren't for the rich who made the tax rules.

Joe Scarborough on MSNBC said it best this morning. The problem isn't government and taxes, its the American people who demand that the pay less taxes but want the same entitlements.

So for those of you who voted 0% on it. FORGET IT! The Country needs the money. Fix the nation and the monies will fall in line.....

But if you get 0% tax on your estate tax wishes, wathc those who hide money, hide even more money and stagnate the market!:suspicious:

 

[Warrenlm]

The option of changing the law still remains. 100% rate. Spend it all or have it confiscated/taxed to support the overall obligations of the government. We're still creating them, even in the latest porkulus. If Steinbrenner's family has to sell the Yankees to pay the tax, who cares? The club will continue. The rich kids should have learned to make it on their own.

 

[tsptalk]

So for those of you who voted 0% on it. FORGET IT! The Country needs the money. Fix the nation and the monies will fall in line.....

We have to learn something from what's going on in Europe... "Keep my tuition low or I am going to break windows." "Raise my retirement age to 62 and I am going to burn cars in the street."

Unfortunately I don't think we will learn because in general, the folks getting benefits / entitlement are not even sure where the money comes from.

 

[nnuut]

I still think that Estate Taxes are just WRONG. Double Taxation is never the thing to do in a Capitalistic state. When people can't inherit the family business without paying the government it tax on the property it's counter productive to the economy and penalizes citizens for over achieving by taking the money back that they worked so hard for for all of their lives along with killing jobs. To me a smaller tax might be tolerable, but levels like 55% on everything over $1 million isn't promoting the economy and the American dream. Just Spreading the Wealth, which makes me sick!

 

[Boghie]

Frixxxxxx,
In a way, I'll beg to differ...

The Federal government's revenue stream is as large as the entire GDP of the United Kingdom.

Bush would have brought the budget into balance if the Great Recession had not happened. Under Bush, our current deficit would probably be about $300 Billion - probably less and shrinking. Obama has increased spending tremendously. I am hoping that increase was 'stimulus' and not structural.

And, I kinda like the 35% over $5 mil balance. Bet none of you figured that I would be in that group, eh. Maybe it is this stupid winter cold that is making me kinda Libby...

Our government needs to cut staff and realign to necessity.

 

[Frixxxx]

I guess my true point on the matter is this:

Let's say I am a working civil service member and I tuck away 1,000,000 into my TSP.

I die and have to leave the estate to my heirs.

If I took the money out, it would be taxed at income levels at that time.

If I was single and I took the money out as earned income then my tax rate would be 32%.

That should be the highest level of tax on estates. Why is there more levied on it just cause it's an estate?

My calculations were done using the 2010 tax rates and levels.

 

[Frixxxx]

Another interesting poll......


Illegal search and seizure...... By riding the metro in D.C., does that constitute a viable reason for search? If I wanted to drive my own car into D.C. and got randomly pulled over to do a thorough search of my vehicle, would that be right?

I think this whole search thing is getting outta hand.

I remember when people used to tell me that it was great living in a country where the government didn't have the power to do those things....But if you got your wolf into sheep's clothing and could do things at your leisure and call it good......


hmmmm....maybe that's how MBSs started in the financial world......Evil wrapped in sugar-coated packages or carbon credit trading...making money at the expense of the planet....WTF?????????

 

[crws]

Another interesting poll......


Illegal search and seizure...... By riding the metro in D.C., does that constitute a viable reason for search? If I wanted to drive my own car into D.C. and got randomly pulled over to do a thorough search of my vehicle, would that be right?

I think this whole search thing is getting outta hand.

I remember when people used to tell me that it was great living in a country where the government didn't have the power to do those things....But if you got your wolf into sheep's clothing and could do things at your leisure and call it good......


hmmmm....maybe that's how MBSs started in the financial world......Evil wrapped in sugar-coated packages or carbon credit trading...making money at the expense of the planet....WTF?????????

http://www.britannica.com/EBchecked/topic/135329/contract-of-adhesion
Also known as a "Boilerplate Contract"
-All in the microscopic fine print... same for parking garages, concert venues, etc....

Contracts of adhesion

There are large areas of economic life in which the parties to contracts have such unequal bargaining positions that little real negotiation takes place. These contracts are often known as contracts of adhesion. Familiar examples of adhesion contracts are contracts for transportation or service concluded with public carriers and utilities and contracts of large corporations with their suppliers, dealers, and customers. In such circumstances a contract becomes a kind of private legislation, in the sense that the stronger party to a large extent assigns risks and allocates resources by its fiat rather than through a reciprocal process ... (100 of 6115 words)

 

[alevin]

I still think that Estate Taxes are just WRONG. Double Taxation is never the thing to do in a Capitalistic state. When people can't inherit the family business without paying the government it tax on the property it's counter productive to the economy and penalizes citizens for over achieving by taking the money back that they worked so hard for for all of their lives along with killing jobs. To me a smaller tax might be tolerable, but levels like 55% on everything over $1 million isn't promoting the economy and the American dream. Just Spreading the Wealth, which makes me sick!

When the bulk of the inheritance is invested in the family business-ranch, farm, small biz-and the taxes are more than the cash available, it forces sale of landbase, going into debt to pay the taxes, etc. that is a huge problem.

It's when the inheritance primarily consists of financial paper that can be sold without hurting a productive family business, that the estate tax makes more sense to me.

 

[Steel_Magnolia]

When the bulk of the inheritance is invested in the family business-ranch, farm, small biz-and the taxes are more than the cash available, it forces sale of landbase, going into debt to pay the taxes, etc. that is a huge problem.

It's when the inheritance primarily consists of financial paper that can be sold without hurting a productive family business, that the estate tax makes more sense to me.

That is exactly it. There have been several ranches in the county where I grew up that have had to sell upon the death of the patriarch. It was just acres and acres of scrub oak that wouldn't support many cattle AUMs. But the scenery is breathtaking. So the value of the land is inflated because of its worth as 5-acre ranchettes for well to do retirees.

Very different from someone who dies with millions in bearer bonds in the safe.

Maggie

 

[nnuut]

Alevin
So does that mean you approve if it's not business investment money but other material things of value willed over to beneficiaries, LIKE MOM AND DAD'S HOME or LIFE SAVINGS? you know it's not unusual for a home to be valued at over a million dollars in some parts of the country. Inflated real estate prices are abundant and need to be corrected, somehow?

 

[alevin]

Home is landbase. heirs should not be forced to sell just to pay taxes. but if they don't want to live in the place, they'll eventually sell it or rent it out and still pay taxes on rental income less maintenance costs etc, or pay cap investment taxes on cash value of the property above basis ($250K/$500K). right?

I'm talking financial paper that is sellable on open market-if there is any estate tax at all (not saying there should be), saying that there shouldn't be any on income-producing property or family business/home. I'm open to the question of taxation on inherited fiscal paper, the basis is bumped up at the time of inheritance, no? (I have no real world experience with this subject so the implications for fiscal paper are not as clear to me as the situations I'm talking about where I think should be off-limits for inheritance tax).

And yes, real estate prices need to come down to earth instead of staying up in unbreathable stratosphere, so if heirs can't pay the mortgage, they have to sell anyway and pay taxes on cap gains over the nontaxable base.

 

[Frixxxx]

To those 3% with no cell phone:

Recommend a prepaid phone in your glove compartment.....

10 bucks at Walmart, and you can find a cheap bundle of minutes......

Just for emergencies!!!!

BE SAFE OUT THERE!

P.S. Does anybody actually put gloves in that thing anymore?

 

[jimijr]

While you may think that the taxes have already been paid on an estate, that is not really true.

If there were equities, the tax on their gain would be levied only when they are sold which will not happen, now, due to the death of the holder.

If the home increased in value, this amount would be free of taxes against the deed holder were the property sold and the money used to buy a new home, but when it is transferred to the new deed holder this provision does not apply.

So there are good reasons to tax estates. I believe they exempted the first $5 millions which accounts for most of us working stiffs I'd say.

 

[SkyPilot]

This can all be avoided with a "revocable trust"

 

[crws]

Another interesting poll......


Illegal search and seizure...... By riding the metro in D.C., does that constitute a viable reason for search? If I wanted to drive my own car into D.C. and got randomly pulled over to do a thorough search of my vehicle, would that be right?

I think this whole search thing is getting outta hand.

I remember when people used to tell me that it was great living in a country where the government didn't have the power to do those things....But if you got your wolf into sheep's clothing and could do things at your leisure and call it good......

hmmmm....maybe that's how MBSs started in the financial world......Evil wrapped in sugar-coated packages or carbon credit trading...making money at the expense of the planet....WTF?????????

Frixxxx, I thought of your post when I saw this: Helluva Ride

http://www.youtube.com/watch?v=_bSRQ5LMhaU

 

[Frixxxx]

This weeks poll is not going well for Mr. Trump!

53% Romney
21% Trump
26% Demo-something


Sorry Buster!

 

[Sensei]

Is it just me, or does it seem that this week's poll topic could be simply fact checked?

 

[tsptalk]

Could be.

 

[Sensei]

Since the kids are in bed and I've searched to the end of the Internet, here's a pretty chart from Wikipedia. And the winner is...



http://en.wikipedia.org/wiki/List_of_preventable_causes_of_death

Looks like cars just edged out firearms. I think this was from 2009, by the way.