Death Tax Is the Unfairest Tax of All by Stephen Moore

It was in 1916 — 100 years ago this year — that America made a big, big mistake, one that has done significant damage to our economy and the fairness of our tax system for an entire century. We are talking about the estate tax, more popularly known as the death tax.

The tax is in the news again because Hillary Clinton wants to raise the tax at death from 40 percent to 45 percent and impose it on far more small family-owned businesses, farms and ranches. Donald Trump wants to eliminate this unfair tax, because a lifetime of paying income taxes, sales taxes, property taxes, dividend taxes, capital gains taxes, payroll taxes and employee taxes should be enough. Almost every small-business association in America agrees and has endorsed the Trump plan.

Why is this tax so un-American? Because many small-business owners who want to pass their family legacy on to their kids and grandkids tend to be asset rich but cash poor, meaning their businesses may appear quite valuable on paper but in many cases they lack the cash to shell out 40 percent of the business’s value to the IRS when the parent owner dies.

When the kids don’t have the cash on hand to pay a sizable tax bill on their parents’ life savings, they must sell off equipment or land, lay off workers and, in the worst cases, dissolve the family business to pay Uncle Sam’s ransom. What a travesty. Sell the farm to pay the taxes!

So why does the left insist on raising this tax, rather than killing it? The only answer we can think of is greed. Amazingly, this tax raises almost no revenue. In 2014 the estate tax collected — hold on to your hats — 0.43 percent of all federal revenues. It raises less than the government spends every 48 hours.

But to get that tiny morsel of revenue, the tax does substantial damage. When the death tax is high, two things happen. First, really rich people like Warren Buffett and Bill Gates engage in complicated and costly estate tax planning with the best lawyers money can buy to avoid paying the tax. Both Gates and Buffett put billions into a massive charitable foundation, run by family members, in part to avoid death taxes. So the super-rich almost always find ways around this sinister tax. It’s the smaller businesses without clever tax accountants that get clobbered.

A 2009 report found that the life insurance industry collects almost as much as the government does per year from the perpetuation of the death tax. No wonder Warren Buffett, who owns seven life insurance companies through his behemoth Berkshire Hathaway, is seen cheering on Clinton’s calls for taxing even more businesses at an even higher rate. According to the same report, the Buffett life insurance cabal funded a perky public relations campaign to retain the death tax. He lobbies for a tax he finds every loophole to avoid.

But Hillary Clinton may be the biggest hypocrite of all. She says the Trump plan is a tax break for millionaires and billionaires like him. Yet Hillary and Bill Clinton have gone to great lengths to shelter their own fortune from the death tax, by using sophisticated trusts and moving their New York home into residence trusts to shield it from taxation, according to a Bloomberg analysis, all while pushing for higher death taxes on small businesses.

The Clintons want one set of tax laws for the rest of the country while they and their friends skate free under a separate set of rules. Family-business owners who are too busy sweeping up the shop floor or herding cattle to mount a coordinated national public relations response are collateral damage.

The unhindered transfer of wealth is one of the most vital characteristics of a prosperous economy. Growth is enhanced in America when each generation hands down an endowment of assets and knowledge to the next. We don’t build great empires so that the government can take half of them or more when we die. One reason so many people keep working hard even late into their lives is to leave a family legacy to their children, and then to allow them to pass on that business or farm to their children. We’ve learned through history that if the kids and grandkids live their lives like drunken playboys, the wealth will quickly disappear. If they expand the business, it means more jobs, more wealth, and more tax revenues — and a better life for their children.

This is the process we call the American dream.

Clinton wants to tax that dream away.


IRS Scandal: No End To Lois Lerner’s Lawlessness

Justice: IRS official Lois Lerner didn’t merely target conservative groups to take away their tax-free status, as first suspected, but also handed over more than a million pages of tax returns to the Justice Department. That’s a crime.

It’s now apparent, if it wasn’t before, that the Internal Revenue Service — which was created solely to collect revenues due the government, not to persecute the administration’s political enemies — has become a kind of rogue agency.

Its chief, John Koskinen, is being threatened with impeachment for not telling the truth in testimony before Congress. But Lerner, more than even Koskinen, has become a symbol of IRS arrogance and illegality.

As Eliana Johnson of the National Review reported this week, Lerner transmitted some 1.25 million pages of tax returns of mostly Tea Party and conservative groups to the Justice Department in October 2010. In Johnson’s words, this was “likely the largest unauthorized disclosure of tax-return information in history.”

For some perspective, this took place at the start of a three-year period during which the same groups found their applications for tax-free status inexplicably held up, while those for liberal groups were more or less routinely rubber-stamped.

But the actual transmission of their tax returns as part of a fishing expedition by Lerner is the big problem here — because she also transmitted IRS Schedule B data, which includes the names and addresses of contributors to those conservative groups. That’s a big no-no.

Unfortunately for Lerner, tax returns are nearly sacrosanct under the law. Only an active investigation into criminal acts would allow the IRS to give the tax returns to the Justice Department. And then, by law, Justice would have to specifically request them. They didn’t in this case.

By the way, a good-government group called the Cause of Action Institute has been dredging all this information up as part of its ongoing litigation in the case. We wish them luck.

“The IRS, in the midst of its political targeting of groups engaged in policy advocacy, was engaging in the disclosure of millions of records aimed at ginning up prosecutions of these groups without going through the legally required channels,” Dan Epstein, executive director of Cause of Action, told the National Review.

So it looks like Lerner broke the law — again. But will she be punished? Not likely.

President Obama’s Justice Department already passed on prosecuting Lerner in 2015, despite strong evidence of criminal wrongdoing. IRS chief Koskinen, who is less guilty and less implicated than Lerner in all of this IRS skulduggery, is more likely to be impeached than Lerner is to be brought before a judge.

Loretta Lynch’s Justice Department, it seems, is just as politicized these days as the IRS.

Washington’s Bureaucracy Strikes Again by Sen. Mike Lee

If you want to understand the corruption, deceit, and might-makes-right culture at the core of the federal government’s dysfunction and disgrace today, look no farther than the two big stories out of Washington last week.

On Monday, President Barack Obama’s Treasury Department released sweeping new regulations effectively rewriting the tax code to make it even more difficult for U.S. companies to escape the double taxation on overseas earnings currently extracted by the IRS. Rather than trying to lower the U.S. corporate income tax rate—which is the highest in the industrialized world—the Obama administration wants to make it even more costly to do business in America.

Not to be outdone by the economic folly of their colleagues at the Treasury Department, bureaucrats at the Department of Labor have published 1,000 pages of new regulations—collectively called “the fiduciary rule”—targeting the investment industry that will make it more expensive and less likely for low and middle-income Americans to save for their future. Working Americans already face a host of obstacles that prevent them from saving for retirement or unexpected financial hardships, and observers from across the political spectrum agree that these new regulations will only further discourage private savings.

Source: The Daily Signal

Storming The IRS Gates: An Occupy Movement Worth Supporting

Taxation: A federal judge says the IRS can’t be trusted. Well, he’s right. So when will people in this country finally rise up and force Washington to get rid of this awful agency?

Because a holiday called Emancipation Day was celebrated Friday in the capital district, Americans have a few extra days to file their taxes this year. But the IRS remains, as does its institutionalized abuse of taxpayers. There is no emancipation from the torment of taxation, nor the agents of its collection, on the horizon.

Americans need relief, however. Taxes eat away at our substance, and the IRS makes this all the more intolerable because it decided long ago to be a wedge of enmity between a growing federal government and an ostensibly free people. This strained relationship has deteriorated to the point that the IRS targeted for persecution groups and individuals that it doesn’t like. Organizations that identified as Tea Party and conservative were harassed to the point that some of the victims decided to sue.

It’s hard to be upbeat on April 15, even when tax filing day is delayed. Yet there is a scintilla of hope to be found when a federal official rightly characterizes the IRS as an institution whose word is of little value.

“It’s hard to find the IRS to be an agency we can trust,” Judge David B. Sentelle of the U.S. Court of Appeals for the D.C. Circuit, said Thursday during oral arguments in one of the lawsuits filed against the tax collector in the targeting scandal.

The Washington Times reported that during the hearing Sentelle “said there is strong evidence that the IRS violated the constitutional rights of the groups when it delayed their nonprofit status applications and asked inappropriate questions about their political beliefs.”

What’s more, there’s good reason to think that the mistreatment of Tea Party and right-of-center groups has never stopped.

This should deeply concern us all, even those who aren’t Tea Party supporters. The IRS is not a political arm of the government that’s free to be used to suppress to dissenters. It is merely a tax collector.

Yet it has the power of accuser, judge, jury and executioner. It makes lives miserable, a practice some in the agency seem to enjoy — it’s their amusement. The IRS can be a bully, a thug, an intimidator. It rolls on without checks and balances. One lower court even said that there were no remedies available to make it pay for its misconduct.

Such an agency has no place in a nation founded on freedom. Americans were to never have masters. Liberty was our birthright — as it should be for every human. The IRS violates these principles and deserves to feel the heat and the jabs that only torch-and-pitchfork patriots can bring.

We’re not advocating a physical occupation, of course. But concerned citizens should put unprecedented political pressure on Washington to rid us of this meddlesome bureaucracy. Every year millions of Americans pay the IRS. Now it’s the IRS’ turn to pay.

Source: IBD Editorials

Not Even a ‘Smidgen’ of Corruption at IRS, Mr. President? Appeals Court Begs to Differ! By John W. Lillpop

During a February, 2014 interview with Bill O’Reilly of FOX News, President Barack Obama firmly asserted that there was “not even a smidgen of corruption at the IRS,” in the case involving Lois Lerner and the unlawful IRS targeting of conservative groups for special scrutiny by the powerful agency.

Instead, Obama attributed the matter to ‘bone-headed decisions.’

Those who have been paying even the slightest attention to the travails of Lois Lerner will remember that this anti-conservative partisan democrat escaped justice from the Obama administration without so much as even a “smidgen” of accountability for her untoward behavior, whether criminal or simply ‘bone-headed’ stupidity.

Now, more than two years later, a federal judge who was apparently paying attention has determined the IRS took laws designed to protect taxpayers from the government and used said Laws to try to protect

the tax agency from the very tea party groups it targeted.

As reported at the reference:

A federal appeals court spanked the IRS Tuesday, saying it has taken laws designed to protect taxpayers from the government and turned them on their head, using them to try to protect the tax agency from the very tea party groups it targeted.

The judges ordered the IRS to quickly turn over the full list of groups it targeted so that a class-action lawsuit, filed by the NorCal Tea Party Patriots, can proceed. The judges also accused the Justice Department lawyers, who are representing the IRS in the case, of acting in bad faith — compounding the initial targeting — by fighting the disclosure.

“The lawyers in the Department of Justice have a long and storied tradition of defending the nation’s interests and enforcing its laws — all of them, not just selective ones — in a manner worthy of the Department’s name. The conduct of the IRS’s attorneys in the district court falls outside that tradition,” Judge Raymond Kethledge wrote in a unanimous opinion for a three-judge panel of the Sixth Circuit Court of Appeals. “We expect that the IRS will do better going forward.”

While this reporter has nothing approaching even an elementary education or understanding of the Law, this pummeling by Judge Kethledge sounds suspiciously like more than just a “smidgen” of corruption!

Further, this revelation is particularly disturbing in light of the fact that the future of Hillary Rodham Clinton and her candidacy for the US presidency may very well rest in the hands of the same Obama Department of Justice.

Bottom Line: Will America be told that the Hillary Clinton dossier includes not even a ‘smidgen’ of information that might implicit her in criminal acts and or disqualify her from holding the highest office in the land?

If so, given Obama’s anti-law legacy, why would any discerning American believe such a statement?