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Grassley joins initiative to shut down death tax

February 8, 2019
By Kristin Danley-Greinter - Farm News staff writer (Farm—News—Iowa—KSDG@msn.com) , Farm News

By KRISTIN DANLEY-GREINER

Farm-News-Iowa-KSDG@msn.com

U.S. Sen. Charles Grassley has teamed up with Republican senate leadership to reintroduce legislation that would permanently repeal the federal estate tax, which is also known as the death tax.

While the senator's own personal Iowa farm doesn't reach the exempted level, Michael Zona, who works in Grassley's office, said the law impacts many of the senator's constituents.

"Throughout the years, Sen. Grassley's office has heard from Iowans concerned about how the estate tax might affect them," Zona said.

Called the Death Tax Repeal Act of 2019, the legislators hope to make progress on eliminating the death tax.

U.S. Sen. John Thune, R-South Dakota, tried to repeal the tax in 2017 as it piggybacked onto the Tax Cuts and Jobs Act. The final version of that particular act did not repeal the death tax, but instead the law doubled the individual estate and gift tax exclusion to $10 million and then to $11.4 million in 2019 through 2025.

"Although we made great progress during the Tax Cuts and Jobs Act negotiations, the death tax still remains an onerous and unfair tax that punishes hard-working families," Thune said in a statement.

Opponents of the federal estate tax say it inhibits farmers' ability to pass their operations on to future generations because of the steep taxation applied to the inheritance.

Attempts to repeal the tax in the past have been unsuccessful.

Senate Majority Leader Mitch McConnell, R-Kentucky, a supporter of the repeal act, described the death tax as the government's "final insult to force grieving families to visit both the undertaker and the IRS on the same day."

Grassley agreed.

"Congress ought to do everything possible to encourage family enterprises to get next generations involved and keep the doors open for business," Grassley said. "It's getting harder all the time to keep a farm or small business in the family from one generation to the next. The estate tax doesn't serve any purpose except forcing family farms and family-run businesses to waste precious capital on costly tax planning and in too many cases, paying taxes on income or property that have already been taxed once."

He expressed support for keeping tax money back home instead of sending it to Washington, D.C.

"it would be far better to allow family farms to keep this money so they can invest in the rural communities they are located in to create new opportunities," he said.

U.S. Sen. Joni Ernst, R-Iowa, is also a co-sponsor of the bill, along with 25 other senate Republicans.

There is also work in the United States House of Representatives on the repeal.

U.S. Rep. Mac Thornberry, a Republican from Texas, has H.R. 222, the "Death Tax Repeal Act." It would "completely and permanently repeal the federal estate, gift, and generation-skipping taxes."

"Tax reform made the death tax less burdensome, but it should be totally eliminated," Thornberry said. "Death should never be a taxable event. All Americans should be able to work hard, build, and save knowing that they can pass on what they have earned to their children and grandchildren. Americans are required to pay taxes on their savings and incomes while they are alive. They should not have to do so again at death, nor should their children and grandchildren have to bear these taxes."

 
 

 

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