U.S. Representative Richard Hudson, from North Carolina’s 8th Congressional, is looking to permanently eliminate the death tax, also known as the inheritance tax or the estate tax, that is imposed on the transfer of taxable estates of a deceased person.
Hudson introduced H.R. 483, the Farmers Against Crippling Taxes (FACT) Act, to the Congressional Committee on Feb. 4 after he spent three days talking with farmers and hearing their concerns about policies that hinder them.
On the stop in Rockingham, Hudson called the death tax “the most immoral tax we have.”
“In a struggling economy such as ours, we should be finding ways to let people keep more of their hard-earned money. The American people work hard, save, invest, and want to leave future generations with more opportunities and a better life. Unfortunately, the death tax discourages all those traditional American values,” Hudson said.
“They need to eliminate it,” said Danny Bynum, owner of Bynum Peach Farm in Windblow.
According to the group United for a Fair Economy, in 2012 the tax-exempt amount was $5 million. If the total value of the estate is larger than the tax-exempt amount, an estate tax is imposed on the portion above the exemption before the remaining assets are distributed.
The taxes paid on the amount has fluctuated from 55 percent to 35 percent and exemption rates have fluctuated from $1 million to $5 million since 2001.
The tax-exempt amount was made permanent during the fiscal cliff compromise and is now $5 million for an individual and $10 million for a couple.
Hudson said that it makes no sense for the federal government to punish farmers and small business owners.
“Their success does not belong to the federal government, and the benefits of their labor shouldn’t be confiscated from their children and grandchildren when they die,” Hudson said.
The bill will have to be passed by both the House and the Senate after it is considered by the Congressional Committee. According to GovTrack, the bill has 45 cosponsors, all of them are Republican.
Lee Berry, owner of The Berry Patch in Rockingham, also thinks the tax needs to eliminated. He said he hates to think that he is going to leave his children a property that he has paid taxes on and they will have to also pay a tax on it as well.
Hillsborough attorney Andrew Branan, who specializes in estate planning and administration and farm law, said that although his clients are concerned about the estate tax, now that the federal government has set the amount to “$5 million, it affects only a small amount of farmers.”
Branan said that he thinks eliminating the estate tax is good, but, as a lawyer there are numerous ways to minimize exposure to the estate tax.
Hudson said, “It is time we recognize the facts of this heinous tax and repeal it once and for all.”
— Staff Writer Laura Edington can be reached at 910-997-3111, ext. 18, or by email at firstname.lastname@example.org.