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The Buzz: Trump’s Dangerous Plan to Repeal the Estate Tax

During Donald Trump’s economic speech in Detroit yesterday, he doubled down on dangerous ideas that favor the wealthy, Wall Street, and large corporations. He pushed for repealing the estate tax, which would do nothing to help working families, and would give the Trump family a $4 billion tax benefit.

 

On CNN today, Jennifer Granholm explained that only estates valued at around $11 million are subject to an estate tax, meaning it only impacts the wealthiest 0.2 percent of American families.

 

WATCH

And today, MSNBC economic analyst Steven Rattner tweeted his thoughts about why Trump wants to repeal the estate tax, reaffirming that Trump is only looking out for himself:

 

Donald Trump’s economic speech offered nothing other than stale ideas and handouts for those at the top, including the repeal of the estate tax. Here’s the latest:

 

The Realities of Donald Trump’s Economic Policies

ABC NEWS // CANDACE SMITH

. . . The estate tax is a tax on transferred money and property after death, and it is typically paid only by the very wealthy — families in Donald Trump’s tax bracket. Fewer than 1 percent of estates pay the tax. The average U.S. family would not benefit from abolishing this tax. “A very tiny fraction of all people who die pay the estate tax,” Gale said. “Trump very much tried to frame it as a tax on families, but it’s a fraction of 1 percent of families that pay the estate tax.”

 

Trump Touts Sweeping, and Costly, Tax-Cut Plan

NBC // JOHN W. SCHOEN

. . .Trump also wants to eliminate the estate tax, which generally applies to inheritances of more than about $5.5 million (or nearly $11 million for couples). Opponents of the tax argue that it hurts multigeneration small businesses by imposing an unsustainable burden on the transfer to the next generation. But that burden is vastly overstated, according to some analysts. The current exclusion means that only the wealthiest 0.2 percent of Americans owe any estate tax when they die, according to the Center on Budget and Policy Priorities. While a handful of wealthy families would benefit, according to the CBPP, eliminating the estate tax would cost $269 billion in lost revenues over the next decade, adding $320 billion to the federal deficit when additional interest on the national debt is accounted for.

 

How Trump’s tax plan will actually affect you

CNBC // TOM ANDERSON

. . .You have to earn a lot to be subject to the estate tax. For 2016, the estate exemption is $5.45 million per individual. That means you could leave your heirs up to $5.45 million and pay no federal estate taxes if you died this year. Only about 10,800 individuals who died last year left estates large enough to require filing an estate tax return, according to estimates by the Urban-Brookings Tax Policy Center. After allowing for deductions and credits, that number drops to less than 5,400. . .Ending the estate tax could hurt charitable giving from wealthy people looking to keep the net worth of their estates below the tax’s threshold, Williams said. . .Increasing the estate tax would raise an additional $106 billion over the next decade, according to an analysis by the Tax Foundation.

 

Tax loophole in Trump’s plan would create windfall for the rich

CNBC // ROBERT FRANK

. . . Trump would also eliminate the estate tax, saying that “American workers have paid taxes their whole lives, and they should not be taxed at death.” Of course, the estate tax only kicks in for estates valued at $5.45 million for individuals and $10.9 million for couples, or roughly the wealthiest 0.2 percent of Americans.

 

Trumponomics: The Donald Lays Out Tax Plan That Would Benefit His Family

ROLLING STONE // TESSA STUART

. . .What Trump calls the “death tax,” and what is more widely known as the “estate tax,” is worth an estimated $25 billion a year. Doing away with it would only benefit the children of the very wealthy (for individuals, the first $5.45 million are exempt; for couples, the first $10.9 million) — like Donald Jr., Eric, Ivanka, Tiffany and Barron.

 

Donald Trump’s Latest Economic Speech Was Another Muddled Mess

VICE // HARRY CHEADLE

In his speech Monday, Trump said he would cut taxes on middle-class Americans, but the scant specifics he gave about his tax plans seemed to make it clear that his reforms would be tilted in favor toward the wealthy. Most notably, he’s in favor of abolishing the “death tax,” a.k.a. the estate tax—a policy that would only alleviate the tax burden only for those making more than $5 million.

 

Trump’s Economic Plan: Light on Details, Heavy on Tax Breaks for the Rich

MOTHER JONES // PATRICK CALDWELL

Trump also said he’d like to wipe away the estate tax altogether, using the term “death tax” that’s popular among some conservatives. “American workers have paid taxes their whole lives, and they should not be taxed again at death—it’s just plain wrong,” Trump said. “We will repeal it.” But the inheritance tax, as currently constituted, touches only a small segment of the population. The federal government doesn’t take any taxes out of estates unless the inheritance exceeds $5.4 million for individuals or $10.9 million for couples. That leaves just the wealthiest 0.2 percent of families paying any estate taxes and makes its repeal less than a great boost to the working class.

 

3 big benefits for the rich in Trump’s tax cut plan

NJ.COM // JONATHAN D. SALANT

“American workers have paid taxes their whole lives, and they should not be taxed again at death — it’s just plain wrong,” Trump said. “We will repeal it.” Few American workers will ever be subject to the estate tax, which is paid only by multimillionaires. Just 0.2 percent of estates, those worth more than $5.4 million for individuals and $10.8 million for couples, are ever taxes, according to the U.S. Office of Management and Budget,. The Congressional Budget Office said repealing the tax would cost the U.S. Treasury $270 billion over 10 years.

 

Trump’s economic speech: Lots of goodies for the rich, with a hearty dose of gaffes

SALON // SIMON MALOY

. . .The speech itself was full of some fantastically grandiose lies, but this is an especially important one. The estate tax does not fall on “American workers” who are being “taxed again at death.” It affects the heirs of the super-wealthy who will see chunks of their inheritances carved away by the government. In 2015, the threshold at which the estate tax kicked in was $5.43 million, and the percentage of estates that are actually affected is insanely low. Who benefits from eliminating this tax? “Nearly 85 percent of these taxable estates will come from the top 10 percent of income earners,” the Tax Policy Center notes, “and over 40 percent will come from the top 1 percent alone.” It’s a gift to rich people, plain and simple.

 

Trump says economic plan would help poor, but rich would win most

SAN FRANCISCO CHRONICLE // JOE GAROFOLI

. . . Trump wants to eliminate the estate tax — which he referred to as the “death tax,” as most conservatives pejoratively do. “No family will have to pay the death tax,” he said Monday. “American workers have paid taxes their whole lives, and they should not be taxed again at death — it’s just plain wrong. We will repeal it.” But this proposal directly affects only a small number of wealthy families. In 2016, the law allows people to receive $5.45 million per individual before paying taxes. Conservatives like to say that this law is designed to protect family farmers who want to pass their land onto their children. But an analysis by the Urban-Brookings Tax Policy Center found that only that one tenth of 1 percent of the amount of estate taxes paid last year came from small businesses and farms.

 

Donald Trump just proposed repealing the ‘death tax.’ Here’s why that’s a scam.

LA TIMES // MICHAEL HILTZIK

We’re especially interested in one element of Trump’s plan: repealing the estate tax. . . But to us it’s the most intriguing because it’s such a narrowly focused cut, yet one dressed up as a boon for ordinary Americans—Trump himself called it a burden on the “American worker.” Yet as we observed in 2009, the estate tax affects only a few thousand people at most, all of them multimillionaires with an average nest egg of more than $30 million.

 

Donald Trump’s economic reset shortchanges his base

CHICAGO TRIBUNE // CLARENCE PAGE

. . .Other parts of Trump’s agenda sound great for corporations and upper-income workers but don’t offer much to his working-class base. The “death tax” he promises to scrap actually is the estate tax, which affects only 0.2 percent of all estates. It doesn’t kick in until the estate exceeds $5.4 million for an individual or $10.9 million for a married couple. Call it what you want, but it’s not a tax break for the poor, no matter how many upset waitresses or taxi drivers I run into who think it applies to them.

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