How the Estate Tax Benefits Small Businesses
Don't let opponents of the estate tax frighten you.
Small business owners like me have for too long served as poster children for a misleading campaign led by the super wealthy to weaken or abolish the estate tax. I'm the proud owner of Maine's Borealis Breads, and I want to make something crystal clear: The estate tax impacts neither me nor the vast majority of small business owners. In fact, I support a stronger estate tax.
In 2009, a married couple could leave $7 million tax-free to their heirs. Most small business owners' annual incomes are too little to accumulate enough wealth to pay the estate tax. In 2009, individuals earning less than $82,000 declared 95 percent of all small business income, according to the Congressional Research Service. It should then be no surprise that the nonpartisan Tax Policy Center estimates that fewer than 100 American small business or farm estates were expected to pay the estate tax in 2009.
A provision in the tax cuts passed under President George W. Bush made 2010 the first year since 1916 that estate taxes were not levied, resulting in the loss of billions of dollars in federal revenue. For generations, even with the estate tax in effect, families have been able to pass their small businesses and farms onto their descendents. These same generations of small family businesses have enjoyed and benefited from the unprecedented opportunities found in America.
So if the estate tax has no real impact on an overwhelming majority of small businesses, why then do its opponents so adamantly assert that it does? I believe the answer to that question is that opponents are trying desperately to convince average Americans that they'll be affected by the estate tax. In reality, the estate tax is deliberately designed to affect only society's wealthiest households. [...]