Sunday, November 21, 2010

Suicide before 1/1/11 to Escape Estate Taxes

I've written about this in the recent past. And now the Wall Street Journal has come to realize that some folks are contemplating death before the New Year to escape the prospect of resuming, hefty estate taxes in 2012. Is suicide the answer? The Journal reports:

"Welcome to the macabre world of estate planning 2010, where such questions are relevant. They stem from the fact that this year there is no estate tax, but on Jan. 1, 2011, it snaps back with a low $1 million exemption per individual, down from $3.5 million in 2009, and a 55% top rate, up from 45%. (By the way, the answer to the question is "yes": A suicide won't affect federal estate taxes and inheritances, though it can affect insurance payouts.)
The return of the estate tax in 2011 presents dilemmas even more gruesome than those of a year ago, when taxpayers clung to life past Jan. 1, 2010, to escape death duties their estates would have owed in 2009. This year, by contrast, the tax code is giving taxpayers an incentive not to live but to die—saving heirs as much as 55 cents of tax on a dollar of assets.
Resolution is nowhere in sight, although Congress is expected to raise the 2011 exemption at some point. The Bush tax-cut extension has lawmakers so tied up that they have pushed the estate tax to a back burner. According to BNA's Daily Tax Report, Senate Finance Committee Chairman Max Baucus (D., Mont.) said on Nov. 16, "We're barely talking about it, let alone ready to make a decision." 
Yes, this is downright kooky stuff. Kooky and true.
"Although some have joked about "throwing Momma from the train" before 2011, attorney Joshua Rubenstein of Katten Muchin Rosenman in New York believes a greater danger is tax-motivated suicides: "Most people don't kill their relatives, but I'm afraid that moms and dads who are already sick will quietly kill themselves."
The Bible teaches that the "love" of money is the root of all evil. But in our society it is really that money itself is the root of all evil. Whether we wish to admit it or not, we are slaves to money. It controls our lives from something as simple as having to put a quarter in a parking meter (or face towing and a huge fine) to needing money for every purchase whether necessity or luxury. And now money is even motivating some to take their own lives to protect hard earned assets. Astonishing.

Link to Journal story

No comments: