New Estate Tax Proposal

As I previously mentioned, George Steinbrenner’s death this year saved his heirs approximately $500-600 million. Steinbrenner’s death, combined with three other billionaire deaths in 2010, may catch the attention of Congress and motivate it to act.

I have previously mentioned Senator Kyl’s proposal and Senator Sanders’ proposal. The latest proposal came from Representative Thompson (D-CA). He advocates an unlimited exemption for farms. However, an exemption like this one would simply incentivize the ultra-wealthy to transfer their wealth to farmland, effectively allowing these few families to opt out of paying estate taxes. Further, it would actually hurt farmers rather than helping them because the price of agricultural land would increase.

See Ruth Marcus, George Steinbrenner and Estate Tax Insanity, The Washington Post, July 15, 2010; Peter Whoriskey, Steinbrenner Heirs Could Save Millions from One-Year Gap in Estate Tax, The Washington Post, July 14, 2010; Debra Cassens Weiss, Steinbrenner’s 2010 Death May Have Saved His Heirs About $600M, ABA Journal, July 14, 2010.

Special thanks to Joel Dobris (Professor of Law, UC Davis School of Law) for bringing these articles to my attention.