Inheritance Rights

[Stealth]

This is something I went over in school a few months ago and I wanted to bring up here.

I feel like inheritance perpetuates the aristocratic class. We should live in a system of meritocracy where hard work pays off. If we imposed a law on inheritance rights, where an individual could only pass so much of their estate on in their will, we could quickly redistribute money so that there's not such a huge economic disparity. If, for example, we could pass the first 300,000 of our estate on after our death, 90% of America wouldn't be affected by the law. For the 10% of the US that has billions of dollars, when they die, they can leave 300,000 to their kids and the rest goes the government. They can pass their wealth onto their kids during the kids lives by providing for an education and getting them job opportunities.

They tried this in the USSR, but it didn't work out. It only lasted a year or two, but a lot of it had to do with bad government. Bill Gates and a few other billionaires actually support this idea. If we removed inheritance rights, in ONE year, we could completely remove the deficit. People would have to work to get to where they are in life.

There's argument for and against this. Some people say that the economy wouldnt work out because people wouldnt work as hard if they knew they couldnt pass on their money after death. Some people say that its fair because the descendents did not earn the money and there's no reason why they should have an unfair advantage just because they were born to rich parents.

What do you guys think?

 

[50cal]

Well i would be pissed if the government got money that my family set aside for the kids/ grandkids......What if your parents worked hard their whole life and didn't spend much on themselves..no lavish trips/vacations....drove same cars for years etc...pinching money so they can rest easy when they die because they know their kids have money for emergencies..etc..
Meanwhile many families have already profited heavily off situations....It would be interesting for the extremely wealthy that there dynasty will most likely die off and everything balance out.....ya know the ones where they aint gotta work..they just sit back and watch their money grow.

 

[antoniog831]

^agree with you, (parents struggling for their kids future) if anything fuck the rich, there private school should prepare them to excell, fuck giving them hella cash

 

[Stealth]

This isn't about the struggling parents though. If there's a cap on a certain amount, then most people would still be able to pass their property. You figure most people own under $300,000 worth of shit when they die. Even $1,000,000. If you cap it at that amount, you'll have the large majority of the US not being affected by it at all. Only the really really rich.

 

[nhojsmith]

people with money have more incentive to keep it. people without money just beg for scraps. go ahead and impose this law, the rich will find a way around it or move their money to another country. damn i wish i still thought a mill was really really rich. im against your little socialist plan. socialists are funny to me. these are the types who want to grow up and get out the house to feel like an adult, but then want not only their parents to take care of them, but society at large. ill accept your plan with the caveat that we eliminate welfare and social services since you claim to value meritocracy. ha.

 

[ColdBlooded]

I feel like inheritance perpetuates the aristocratic class.

Amen

 

[Stealth]

im against your little socialist plan. socialists are funny to me. these are the types who want to grow up and get out the house to feel like an adult, but then want not only their parents to take care of them, but society at large. ill accept your plan with the caveat that we eliminate welfare and social services since you claim to value meritocracy. ha.

Yes, I am the type to grow up, get out of the house, feel like an adult, have my parents and society take care of me. Get a clue buddy. You might not like socialists, but I dont like people who make blanket assertions.

And I do value meritocracy. Unforunately we dont live in a society where meritocracy exists. I'll eliminate social services and welfare with the caveat that you eliminate outsourcing, executive compensation, nepotism, cronyism, discriminatory job hiring practices, and anything else that exploits the weak and poor at the expense of the already rich.

 

[kayvee]

This isn't about the struggling parents though. If there's a cap on a certain amount, then most people would still be able to pass their property. You figure most people own under $300,000 worth of shit when they die. Even $1,000,000. If you cap it at that amount, you'll have the large majority of the US not being affected by it at all. Only the really really rich.

my moms house is worth over $500k. thats property, but over your $300k cap.

what about life insurance? place a cap on that? thats cash.

~k.

 

[nhojsmith]

Yes, I am the type to grow up, get out of the house, feel like an adult, have my parents and society take care of me. Get a clue buddy. You might not like socialists, but I dont like people who make blanket assertions.

And I do value meritocracy. Unforunately we dont live in a society where meritocracy exists. I'll eliminate social services and welfare with the caveat that you eliminate outsourcing, executive compensation, nepotism, cronyism, discriminatory job hiring practices, and anything else that exploits the weak and poor at the expense of the already rich.

deal. oh yeah, you dont have the power do shit about it.

 

[Stealth]

^ I <3 U

my moms house is worth over $500k. thats property, but over your $300k cap.

what about life insurance? place a cap on that? thats cash.

~k.

Well, the idea that I got this from listed 300,000 a while ago. With inflation its more like a million. You can always raise the cap too, because money isn't what it used to be.

Life insurance is nonprobate. You don't pass that through your will. It is already taxed to some extent.

But i'm not really talking about the technicalities. Its more about the concept. I've heard a lot of ideas over the years about things we could or should do to make this country a little more equal, and most of those ideas don't seem like they'd really work out. This one definitely has its downsides, like nhojsmith said, rich people can always find ways to get around stuff. But as a concept, it seems a little more workable than most.

 

[Mr. Nice Guy]

One of my boys does estate planning and he is always telling me ways to get around the "death tax".

Some faults with your plan are:

1) If you were to do something like this, not counting the people who would spend tons of money finding creative ways to get aroud the tax, you would have an exodus of the rich to "tax haven" places such as The Bahamas or The Channel Islands etc.

2) The bigger problem with this is that it doesn't shift the wealth balance from the Rich to the Poor, it shifts it from the Rich to the US Government. I don't think to many people would argue that the government has a great track record of being able to distribute money efficiently or effectively.

You could argue that regardless of the government's ability to use this money effectively, they would still be able to develop programs to benefit the lower class. The problem here is that the whole idea of the inheritance tax is to redistribute the wealth to the lower class, and when the government controls the money it is only strengthening the lower class dependence on federal aid and not helping to create their own wealth.

 

[Stealth]

Self-settled asset protection trusts in islands aren't always a good idea. If you transfer your funds overseas and you end up getting sued or you have to pay taxes, the court can force you to get your money and give it back. If you don't give it back, they can throw you in jail for contempt. If you don't have any creditors, its not a bad idea. Also, some states like Alaska have started doing the same thing so you dont need to go to Cooks Islands or Caymans or whatever.


I agree with you that it just transfers the money from the rich to the government...not much of a change. But its a step in a new direction.

 

[AGENT707]

Islam law actually states that the inheritance SHOULD be distributed to many family members including women and sometimes even distant family members..

so back in the day(im talkin 15th, 16th, 17th, 18 centurys) muslims essentially were prevented from forming corporations because if a member were to die the operation would have to end and all of that persons assets would be broadly distributed..the largest partnerships consisted of usually 6 people..

this is actually 1 reason y the middle east failed to grow like europe did...this as well as many other business practices held muslims back..

christians and jews even living in the same town etc. did not have to abide by Islam law and matters could be handled in non-Islam courts

 

[phil]

yeah lets take rich peoples money when they die and give it to the govt. it sure as fuck isnt going to the poor. but whatever, if it makes you feel better to deprive the rich (not all of them are crooked snakes) then keep dreamin. if you think the govt could spend that money better you might as well pack your bags and relocate across the ocean somewhere

 

[Mr. Nice Guy]

Self-settled asset protection trusts in islands aren't always a good idea. If you transfer your funds overseas and you end up getting sued or you have to pay taxes, the court can force you to get your money and give it back. If you don't give it back, they can throw you in jail for contempt. If you don't have any creditors, its not a bad idea. Also, some states like Alaska have started doing the same thing so you dont need to go to Cooks Islands or Caymans or whatever.


I agree with you that it just transfers the money from the rich to the government...not much of a change. But its a step in a new direction.

Yeah I wasn't just talking about people putting their money in offshore accounts and investing in "tax haven" places. What I meant was if you make this inheritance tax too demanding, wealthy families/individuals will actually incur the initial losses to move themselves out of this country permanently and become citizens elsewhere for the long-term benefits.

I have recently read a few different articles that have referenced the growing number of wealthy Americans who are already dissatisfied with the rate of tax they are paying, who are moving out of the US permanently. Something like increasing the inheritance tax to a level as high as you suggested would only inspire more of the wealthy to follow suit.