Biden’s war on small business

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Binman4OSU

Legendary Cowboy
Aug 31, 2007
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Stupid about AGW!!
#2
why does their link say "Billions" of small businesses ?

here is the current law

Since 2018, estates are only taxed once they exceed $11.7 million for individuals; $23.4 million for married couples, at a top rate of 40%. (The value of a primary home is exempted up to $250,000 for individuals and $500,000 for married couples.) The estate tax gets levied on property, including cash, real estate, stocks and other assets transferred at death to heirs.

Here are the changes Biden is mulling over

The Biden campaign proposed reducing the estate tax exemption to $3.5 million per person ($7 million for a married couple), which is what it was in 2009, while increasing the top rate to 45%.
With the current $11.7 million threshold, very few Americans ever have to deal with the estate tax. The Urban-Brookings Tax Policy Center estimates that only about 4,000 individuals dying in 2018 left estates large enough to require filing an estate tax return. After allowing for deductions and credits, a mere 1,900 estates owed the tax.

A capital gain occurs when an asset is sold for a higher price than its purchase price, known as its "basis." When you inherit an asset, under current law, the "basis" is its value at the time of the owner's death. That's called — pardon the tax jargon — the "stepped-up basis."
So, today, when someone dies, capital gains are only taxed once the heir sells the asset at a profit based on the value of the asset when he or she received it (not what the original owner paid).
Here's a simplified illustration. Your mother bought stock for $10 a share in 1990 and the stock was worth $200 a share at her death in 2018. You inherit the stock without paying any capital gain and sell the stock this month at $400 a share. You'll only owe capital gains taxes on the difference between $200 and $400.
Now, here's how things could change: Biden said during the campaign that he wanted to tax unrealized capital gains at death, regardless of whether the heirs sell the asset at that time. Put another way, if this proposal takes effect, the "stepped-up basis" rules would end and heirs would owe taxes based on the difference between what the deceased originally paid and the value at his or her death.
 
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UrbanCowboy1

Some cowboys gots smarts real good like me.
Aug 8, 2006
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#3
Bruh, if you are running a sole proprietorship that's valued at or over $12M, and don't convert to an LLC, I've got to assume you don't want your kids to inherit it.

Besides the article (vaguely) saying so, why do you think this will wipe out small businesses? With proper estate planning this should have no impact on small businesses. This tax is aimed at the Waltons and Gates of the world.
 

Cimarron

It's not dying I'm talking about, it's living.
Jun 28, 2007
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#5
who will find ways to never pay a dime under this law. Pass another and they will still find ways to not pay.
The idea that taxes are aimed at those who contribute large sums of dollars to political campaigns is foolish thinking. Forget the political talking points, they aren't meant to give one facts.
 

andylicious

Territorial Marshal
Nov 16, 2013
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#6
Bruh, if you are running a sole proprietorship that's valued at or over $12M, and don't convert to an LLC, I've got to assume you don't want your kids to inherit it.

Besides the article (vaguely) saying so, why do you think this will wipe out small businesses? With proper estate planning this should have no impact on small businesses. This tax is aimed at the Waltons and Gates of the world.
So it drives more people to incorporate in Delaware which has zero tax on that?
 

Cimarron

It's not dying I'm talking about, it's living.
Jun 28, 2007
53,438
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#7
US Tax Revenue by Year

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Does anyone really expect this trend under Biden to really change? Or are his comments little more than smoke and mirrors?
 

UrbanCowboy1

Some cowboys gots smarts real good like me.
Aug 8, 2006
3,662
1,880
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Phoenix, AZ
#8
who will find ways to never pay a dime under this law. Pass another and they will still find ways to not pay.
The idea that taxes are aimed at those who contribute large sums of dollars to political campaigns is foolish thinking. Forget the political talking points, they aren't meant to give one facts.

You'll get no argument from me on this.