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So what's the real concern over taxing estates when it applies to so few situations?
I've heard for years, randomly about this supposed 'death tax', and always sort of just believed what I caught through the grapevine. Something about the government taxing your collective estate at a ridiculously high rate right after you pass away. Hence the death tax part of it. A tax imposed just for dying, as if we need more taxes right?
This always sounded like the absolute worst reason and logic to constitute a tax; a very unfair and obvious attempt to just collect more tax revenue, and I always hated the idea outright. That is, until I finally did a bit of research and quickly realized that the rumors were mostly wildly untrue, and that it's really not that bad or outlandish of a tax after all.
In reality, its a sensible tax imposed only on estates over the threshold of $5,340,000, and even then there are a myriad of loopholes to circumvent having to pay the 40% charge. (gift tax allocation, marital diversifying of assets, etc) Seems at the end of the day the estate or 'death' tax is really just a way to ensure that the very wealthiest in this country don't find a way to avoid paying their fair share of property or inheritance taxes on enormous estates.
So that being the case, am I missing something with all the rumor mill complaints over this tax? Does it just get trumped up because of the nickname, and the fact that most people such as myself prior to a few weeks ago didn't even know exactly the way that it worked and who it applied to? Or is there another reason why so many people hate this particular part of the tax code?