Wealthy Individuals Ask Congress to Extend Estate Tax to Promote Philanthropy

"Several wealthy people today added their voices to a campaign to get Congress to extend and strengthen the estate tax, calling it a key incentive for people to leave money to charity. [...]

The [press teleconference] was organized by United for a Fair Economy [...] The group is pushing Congress to act before its holiday recess to renew and increase the tax that applies to large estates when people die — which is set to expire at the end of the year.

The wealthy participants said the tax is a small price to pay to support government services like education and research that allow people to become prosperous in the United States. It also encourages philanthropy, they said, because people with large fortunes can make gifts to charity without paying taxes on them. [...]

[United for a Fair Economy] favors a proposal by Rep. Jim McDermott, Democrat of Washington, which would apply a 45-percent tax, with a $2-million exemption per spouse, and index the exemption to inflation. It would also tax assets above $5-million at 50 percent, and above $10-million at 55 percent.

Lee Farris, the group’s estate-tax policy coordinator, says extending the current law, rather than returning to the higher rates that are now set for 2011, would amount to a '$391-billion tax break to the wealthiest 1 percent of Americans over 10 years, at a time when economic inequality has skyrocketed.'

United for a Fair Economy proposes that Congress extend the current rate for one year, but strengthen the tax after that."

Read the full article in the Chronicle of Philanthropy.

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