By Brandon Moseley
Alabama Political Reporter
Congressman Spencer Bachus (R) from Vestavia has been recognized by a national seniors group for his efforts to abolish the estate tax, better known as the “death” tax.
Representative Bachus said in a written statement, “The death tax is fundamentally unfair to families that work to build assets to pass on to their children and grandchildren so they can enjoy a better standard of living. It is often small businesses and family farms that feel the brunt of taxes that can seem almost confiscatory. In my view, people are taxed enough during their lifetimes and there is a point where the reach of the federal government should stop.”
The 60 Plus Association awarded Rep. Bachus it’s Benjamin Franklin Award for his support of legislation to permanently abolish the estate tax. Rep. Bachus has cosponsored two bills which were introduced in the 113th Congress (H.R. 147 and H.R. 2429) that would fully repeal the tax.
The Chairman of the 60 Plus Association, Jim Martin, said in a written statement released by Congressman Bachus’s office, “It was Franklin who famously said there are two certainties in life, death and taxes, but because of the estate or ‘death’ tax, there is a third certainty – taxes after death. 60 Plus decided to give a Benjamin Franklin Award to those who support repeal. 60 Plus honors Representative Bachus with this award because he is working hard to get rid of that third certainty – taxes after death – and make Mr. Franklin’s Accurate once again.”
While we are alive the government taxes all the wages that we earn. If we save money the interest on the savings is also taxed, as are profits, capital gains, rents, dividends, etc then when we die the government demands 45% (or more depending on our state’s inheritance laws) of what we have left above a certain exemption level. The 2013 exemption amount is $5,250,000.
The death tax can be devastating for farmers and small businessmen. A farm or business can easily be worth more than the exemption by itself. Families are left with the difficult decision to either sell the farm or business to pay the taxes or give the government all of their liquid assets and go into debt to pay the tax bill and this is before any divisions of assets called on by the will.
American Farm Bureau Federation (AFBF) President Bob Stallman said in a June statement in support of legislation to repeal the estate tax said, “Individuals, family partnerships and family corporations own 98 percent of our nation’s 2 million farms and ranches. When estate taxes on an agricultural business exceed cash and other liquid assets, surviving family partners may be forced to sell land, buildings or equipment needed to keep their businesses running. This not only can cripple a farm or ranch operation, but also hurts the rural communities and businesses that agriculture supports.”
The AFBF says that 85% of farm and ranch assets are illiquid in things like fields, forests, brood cows, tractors, homes, barns, combines, silos, etc. This leaves farm families with few options to generate cash to pay the estate tax. According to the AFBF, Recent increases in agriculture cropland values, on average 15 percent from 2011 to 2012, have greatly expanded the number of farms and ranches that now top the estate tax exemption. “Farm Bureau believes the estate tax should be eliminated permanently,” Stallman said. “We fully support The Death Tax Repeal Act of 2013 to get the job done.”
The group made the presentation of the Benjamin Franklin Award to Congressman Bachus during a Capitol Hill program.
Congressman Spencer Bachus represents Alabama’s Sixth Congressional District and is the longest serving member of Alabama’s U.S. House delegation.