Do we really have that many people who leave behind 2 million dollar estates in this state? While I agree that perhaps 2 million dollars is a bit low considering inflation, the estate tax fuels the creation of charitable foundations and organizations that fund a lot of the charitable work in this country. Avoiding creating a permanent overclass of Paris Hilton-like spoiled children is a nice side effect, too. The federal minimums for estate size, before an estate would have to pay a dollar of estate tax, btw, are $3.5 million and $7 million for single and joint couples respectively. Those numbers make more sense as limits, but I still don’t understand what the uproar about this tax is about… there’s nothing here that affects most people. I don’t understand how it’s a popular issue…

Kevin Drum linked to a good roundup of Estate Tax policy information on his site. The most striking pieces of information:

• Under the $3.5 million/45% plan, we would retain 60% of the revenue that we get from the current estate tax. This would pay for about half of the projected Social Security shortfall.
• 99.7% of all estates would pay no tax at all.
• Only 50 (that’s “fifty,” not “fifty thousand”) farms and small business would owe any estate tax.
• Conversely, repealing the estate tax entirely would cost nearly $1 trillion over ten years. That’s “trillion,” not “billion.”

99.7%… the compromise current plan seems reasonable. Even without the compromise plan, with the current $2 million dollar exemption, only 0.5% of estates are taxed with the 2006 law. The exemption rises to $3.5 million in 2009. This seems like a complete non-issue and a sop to very, very wealthy Americans. When you factor in the cost of a repeal of this tax, plus the fact that we’re fighting a war and are looking at some large entitlement spending bills, is a repeal of the estate tax in the best interests of our country?

Congress is looking at estate tax repeal this month. You should let them know what you think. Or, you can let me know what you think here, since I’m curious about other opinions.

Update: Made a mistake about the current plan vs. the compromise being discussed. The 99.7% number is under the current plan, not the compromise plan.