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Will ‘Fiscal Cliff’ Accelerate Millionaire Deaths?

Posted By admin On December 28, 2012 @ 6:35 am In Money Watch | Comments Disabled

John Carney
CNBC.com [1]
Dec 28, 2012

Because the “fiscal cliff” [2] will not stop for death, it looks as if death’s carriage may make a “kindly” stop to pick up some American millionaires this year, to paraphrase Emily Dickinson.

In 2010, after a year in which the estate tax was zeroed out altogether, Congress passed a law that set the estate tax at 35 percent and exempted all estates under $5 million, adjusted for inflation. That law expires in January 2013 when the exemption will fall to $1 million and the tax will rise to 55 percent.

Many families are faced with a stark proposition. If the life of an elderly wealthy family member extends into 2013, the tax bills will be substantially higher. An estate that could bequest $3 million this year will leave just $1.9 million after taxes next year. Shifting a death from January to December could produce $1.1 million in tax savings.

It may seem incredible to contemplate pulling the plug on grandma to save tax dollars. While we know that investors will sell stocks to avoid rising capital gains taxes, accelerating the death of a loved one seems at least a bit morbid—perhaps even evil. Will people really make life and death decisions based on taxes? Do we don our green eye shades when it comes to something this serious?

Full article here [1]

 


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URLs in this post:

[1] CNBC.com: http://www.cnbc.com/id/100341727

[2] “fiscal cliff”: http://www.cnbc.com/id/49464221

[3] Fiscal cliff talks: Speaker John Boehner pitches millionaire tax hike: http://www.prisonplanet.com/fiscal-cliff-talks-speaker-john-boehner-pitches-millionaire-tax-hike.html

[4] MORGAN STANLEY: The Solution To The Fiscal Cliff Will Be Another Fiscal Cliff: http://www.prisonplanet.com/morgan-stanley-the-solution-to-the-fiscal-cliff-will-be-another-fiscal-cliff.html

[5] The Fiscal Cliff, the Fiscal Gap, and the Lame Duck Congress: http://www.prisonplanet.com/the-fiscal-cliff-the-fiscal-gap-and-the-lame-duck-congress.html

[6] The Good, The Bad And The Ugly From The Fiscal Cliff Deal: http://www.prisonplanet.com/the-good-the-bad-and-the-ugly-from-the-fiscal-cliff-deal.html

[7] Happy New Year Middle Class: The Fiscal Cliff Is Going To Rip You To Shreds: http://www.prisonplanet.com/happy-new-year-middle-class-the-fiscal-cliff-is-going-to-rip-you-to-shreds.html

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