This is a commonly asked question by many that why do the rich people hate to pay the estate tax. Death as well as paying taxes is not avoidable. Some people believe that the reason for collecting the tax and imposing tax law in the country is to prevent accumulation of wealth in a few hands while others believe that it is collected to avoid the hindrance and collection of capital.
The estate tax has fallen down to 40 percent from 55 percent from the year 2000. Along with this, there is now more strictness in order to pay the estate tax. In the year 2000, the estate tax to be paid was 675000 dollars, and now in the year 2018, it is 11 million dollars more than it was before all these years.
Individuals with higher net worth have to pay more estate tax or dispose more significant portions of their estates to their families either when they are alive, or else giving them when they are about to die. The tax was cut from 5500 last year and now in this year it has fallen to 1700 after the tax cut law was imposed.
If we talk about the united states of America, 14 states of the country have to pay the estate taxes while six states have to pay the inheritance taxes according to the revised new policies of the tax department.
Some serious concerns with paying the estate tax
The rich have serious concerns as well as issues when it comes to paying taxes. It mixes up all the feelings and they state that it is not fair for their income to be distributed among the unworthy people as well as the ones who are not deserving of it.
People who earn average incomes as well as those who earn high income absolutely detest paying taxes. People who have high status feel quite bad about their wealth being distributed elsewhere specially to those who they think do not deserve it.
One of the main reasons of hating the estate tax is also very popular because of this reason that no one wants to think that their loved ones are about to die. However, if prepared about the whole tax burden, it can make the situation quite simple.
Types of taxes
There are altogether 3 types of estate taxes which you can pay, the estate tax, income tax as well as the inheritance tax. Estate tax is the tax which is passed on to the family members after the death of one family member. This can also include cash, other retirement accounts, property of the deceased and much more.
A spouse does not have to pay the estate tax on whatever is left for him/her. This is true as well as an excellent advantage because even if the spouse is left with a multimillionaire three story house, he/she will not have to pay any tax on it and will not have any kinds of tax liabilities.
Apart from this, those charities as well as charity organizations which get money and donations from any estate also do not have to pay the estate tax. However, the IRS is very particular as well as strict in determining the kind of charity paid specially if it is a large estate.
The bottom line
Inheritance and the passing down of inheritance is quite a very touchy subject and no one wants to think that there loved ones are about to die. In order to get the complete idea about the estate tax, you need to familiarize yourself with a few very important things before you pursue with it.
It is true that the rich people hate to pay the estate tax because they believe that their income is not supposed to go to someone who does not deserve it at all. They are not ready to pay the estate taxes and they believe that if they pay the estate tax, their income goes to someone who is very unworthy.
This creates an issue as the rich people do not like the idea of their wealth going somewhere else. However, to pay the estate tax is necessary if your country has a law about it.
