- Days left
One aspect of the new Federal budget that has drawn heavy criticism is the reinstatement of the estate tax for 2010. This tax was due to disappear next year as part of a George Bush tax phase-out. However, his legislation would have expired at the end of 2010, sending the estate tax back up to 55%.

The new budget extends the current 45% tax on estates of over $3.5 million (or a joint estate of $7 million).

Those who bemoan the loss of that one year free of estate taxes might want to look at a study by two North American professors who used IRS information to study the correlation between changes in the estate tax and mortality. They found evidence that people have a modest increase in their propensity to die just in advance of an estate tax increase.Another study by two Australian professors used data from 1979, when the country abolished the estate tax, that found that around 50 people more than expected managed to delay their deaths by a week, passing away after the estate tax did. Good news for the heirs, eh? Or were they kept on ice?

If the estate tax had dropped to zero for 12 months, who would have blamed older Americans if they showed a bit of paranoia on the first and last weeks of 2010? After all, capitalism shows us that people behave according to how they are rewarded.

Sounds like a perfect script for the show that ought to exist, Law & Order: Wall Street.

Also read Do-it-yourself funerals


Increase your money and finance knowledge from home

How much house can I afford

Home buying 101, evaluating one of your most important financial decisions.

View Course »

What is Inflation?

Why do prices go up?

View Course »

TurboTax Articles

Top 5 Reasons to Adjust Your W-4 Withholding

Common lifestyle changes, like getting a job or getting married, can change your tax liability. To avoid being caught off guard by an unexpected tax bill or huge tax refund, you'll need to adjust your withholdings on your paycheck.

Does Everyone Need to File an Income Tax Return?

Not everyone is required to file an income tax return each year. Generally, if your total income for the year doesn't exceed the standard deduction plus one exemption and you aren't a dependent to another taxpayer, then you don't need to file a federal tax return. The amount of income that you can earn before you are required to file a tax return also depends on the type of income, your age and your filing status.

How to Write Off Sales Taxes

The Internal Revenue Service (IRS) permits you to write off either your state and local income tax or sales taxes when itemizing your deductions. People who live in a state that does not impose income taxes often benefit most from this deduction. However, you might also be better off deducting sales taxes instead of income taxes if you make large purchases during the year and your total sales tax payments exceed those for state income tax. You can use either the actual sales taxes you paid or the IRS optional sales tax tables.

Add a Comment

*0 / 3000 Character Maximum