Estate Tax Statement from Richard Rockefeller

Estate Tax Statement from Richard Rockefeller, M.D.

The following statement was pre-recorded and delivered on UFE's 12/15/09 Estate Tax Teleconference.

"My name is Richard Rockefeller. I am a family physician living in Falmouth, Maine.

I happen also to be the son of David Rockefeller, and great-grandson to John D. Among other philanthropic activities I currently chair the Board Directors of the Rockefeller Brothers Fund as well as the Advisory Board to Doctors Without Borders-USA. My heritage and these roles keep me keenly aware of the importance of private philanthropy to addressing a host of societal, humanitarian and environmental needs, which neither the business nor the government sectors can meet nearly as effectively.

I am here today to attest that the Federal Estate Tax encourages individuals and families of wealth such as mine to direct significant portions of their estates to philanthropy.

The estate tax is of enormous benefit to the philanthropic community, and its loss would be commensurately harmful. A 2004 study by the Congressional Budget Office found that complete repeal of the estate tax would have reduced total annual philanthropic giving by between $13 and $25 billion in the year 2000, an amount roughly equal to all foundation giving in that year.

Let me illustrate why the estate tax provides an incentive for wealthy people to make philanthropic gifts. Let’s say my wife and I knew we were going to die soon, which we don’t fortunately, this is just a “for instance”. And imagine that we had an estate of $27 million. Our combined exemption would be $7 million, leaving a taxable amount of $20 million.

Every dollar of that $20 million that we direct to tax-exempt organizations would go 100% to those organizations. Meanwhile, every dollar we choose to direct instead toward our children would be taxed at 45%, so there’s a strong incentive for us to give more to charity and less to our children once we get beyond the exemption.

In any case, the $7 million exemption is already a hefty amount to give to our children, tax-free, and they’ve already received a lot of gifts and other advantages in their lifetime.

Let me close by saying that as the great-grandson of John D. Rockefeller, I am perfectly happy that a portion of the wealth he made goes with each succeeding generation toward paying the estate tax. The Rockefeller fortune could never have been created without the foundation of public laws, public education and infrastructure which undergirded American industry in my great-grandfather’s time and continues to do so today. Therefore, far from resenting our tax system, which allows this infrastructure to remain strong, I believe that a strong estate tax makes perfect sense."