With election day looming on the proverbial November 2 date, the House of Representatives voted September 29 to head home to shake a few more hands and put off until the lame duck session, that begins November 15, to discuss expiring tax cuts and the estate tax exemptions. Once again, the unknown future of the “death tax” is back and is especially an albatross placed around the necks of those who operate our family farms, as has been a trend for years.
The motion to adjourn squeaked by with a 210-209 vote, with 39 Democrats, most in tough re- election bids, joining the Republicans to make the vote so close. Speaker Nancy Pelosi was forced to cast the vote that gave the prevailing win to adjourn so members could hit the campaign trail. Now we have to wait and see what happens come the days before Thanksgiving to see if this year the estate tax exemption will be something we all can be thankful for as we gather around our holiday tables or a “turkey” that may be sort of hard to swallow.
Both Democrats and Republicans want a lower estate tax rate and a higher exemption, with the President and Congressional leadership wanting to revive the 2009 structure with a 45 percent tax rate and $3.5 million exemption. With combines costing over a half-million dollars these days and farm acreage being looked at on the same value as gold jewelry to be melted down, farmers are hoping for something closer to a $5 million exemption and a 35 percent tax rate. I had rather see total death to the “death tax” anyway, because it looks like to me we are being double taxed. I know there are those of you who don’t like the term “death tax” and prefer estate tax, but you don’t get an estate tax until somebody dies, thus making it a “death tax.”
You have paid all these taxes on this property all these years while you’re alive and just because you died, now they want to tax it again just because you had it. Why don’t we have a “lost tax” for those who gamble? When someone plays the lottery or cards and loses big, why not tax the amount they lost. We allow a deduction on your income tax for your losses up to your winnings, so why don’t we just tax those losses as well? Yeah, I know that sounds silly, but it makes as much sense as taxing a dead man’s holdings that he worked all his life to own and to have something to pass on to his children. Instead, the government is standing there like something from an old Shakespearean movie taking things from the burial shroud. It just ain’t right.
I know there are those who favor the estate tax and every time I write something concerning the tax, I will always hear from a few who want a list of names of farms that were sold to pay the taxes due to its unfairness. Over the years, due to the efforts of Farm Bureau and others, the exemptions have protected the family farms so an extra long list of sold farms does not exist in my files. But, if something is not done by the end of the year, there will be a list due to the tax rate changing to 55 percent and the exemption becoming $1 million. It is time to make this tax go away or at least become practical for today’s modern agriculture and its assets.
Because 84 percent of farm assets are real estate-based, farm families can be hit a lot harder than many other small business owners when estate taxes are enforced following a property owner’s death. If the family has to sell the land, buildings and equipment to pay the taxes due to not enough cash on hand to keep the operation going, then everyone loses. When the farm disappears, so does business for the shop owners who sell feed, seed, fertilizer and household goods. Plus, the community loses another family, along with their involvement.
The estate tax is just as I labeled it, a “death tax,” because it has the ability to kill farms, communities and future dreams. It is time to bury it for good.