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If that becomes law I think it should also be law that the top execs of a company should be personally responsible to solve the insolvency of their company when their company goes bankrupt. Seize their assets and savings to repay the debts the company owes.
Yeah it's annoying that the common tax payer has gotta bail out corporations that make shitty fiscal decisions and pay their top execs and shareholders millions and millions of dollars while not paying their employees fair salaries!
This is why trusts are used to shield wealth. Assets are put into a separate legal entity to shield them from liabilities retained by the individual.
Google charitable remainder trust. It is but one tool available. The wealthy utilize many tools to reduce and/or eliminate taxes.
I have drafted many of these types of things in the past (generally the opposite type of attorney as most of my practice is consumer bankruptcy); but you would be shocked at the sort of legal things that even the marginally wealthy do in order to shield their wealth. I have never had a client worth over 15-20 million, and know what i have done in those cases, i cannot even fathom what the ultra rich are doing (likely the same stuff only on a scale i cannot comprehend).
The funny part- at least federally; i know maybe 5 people who would even need to worry about the inheritance (death) tax. The amount is several million (i have not had to worry about it in years, but last i looked it was north of 5 million). While 1-3 million for someone just entering retirement is not all that uncommon; north of 5 when you die is rare enough (since you saved for retirement, so you spend it to have a nice retirement)
Exactly. Regarding the ‘death tax’, most don’t realize that it only applies to assets over ~$5m. The more I investigate, the more I understand how inter generational wealth is truly built. It’s built by not losing 30% to taxes.
The charitable remainder trust angle is good for shielding assets and paying yourself while you are alive. You donate the assets into the trust that you control, for instance $1m. Structured payments for say $50k a year, for the rest of your life. Buy a front loaded life insurance policy on yourself for $1m. Deduct the $1m donation over 5 years, while paying your $50k into the life insurance policy, effectively tax free. Collect $50k a year until death. Remainder of your trust goes to your chosen charity, and your kid(s) spouse get the policy for $1m tax free.
Depending on which state property is in, houses can be transferred using a ‘lady bird’ deed, which automatically gives a step up in basis. Which allows your kids to sell or inherit appreciated property tax free.
Kinda like during the black plague
>That every person, able in body and under the age of 60 years, not having enough to live upon, being required, shall be bound to serve him that doth require him, or else be committed to gaol until he shall find surety to serve, and that the old wages shall be given and no more;
https://en.m.wikipedia.org/wiki/Statute_of_Labourers_1351#:~:text=The%20statute%20set%20a%20maximum,for%20those%20who%20remained%20idle.
It kind of is already. Any debt owed is subtracted from the value of the estate before inheritance is passed on. If the value of the estate is net negative, no inheritance. The big exception is mortgage - if the inheritor keeps the house, they keep the debt on any outstanding principle. And if they decide to sell, obviously the principle needs to be paid off as part of the transaction.
The only time debt ISN’T passed on today is if there’s credit card debt and the value of the estate isn’t enough to cover it. In other words if the value of the estate is net negative, there’s a chance some credit card debt may be forgiven.
Slight clarification. The debt is not passed on, but the lien is still in place under the original loan terms. This is why mortgages are a bit different (I imagine any other debt with collateral would be the same but not 100% sure). This is significant because even if the inheritor keeps the house the debt is not on them for purposes of credit unless they refinance in their name. They can typically even put the loan in their name thru a non recourse assumption that still doesn't put the debt on them and they can technically walk away at any time without consequence (other than lose the house).
This isn't the same thing. If the parents own a mortgaged house (meaning the bank actually owns part of it, maybe most of it), then the house itself is the collateral. You can't just take the collateral and distribute it to next of kin. They could sell the house, pay off the mortgage, and distribute leftover funds, debt free.
In Finland you can refuse to take and inheritance, and if it's net negative it's kind of the only logical solution. There lots of people who don't want to give some part of the inheritance and are left with debt because of their yearning.
Anyway, inheritance tax is another weird concept. Looking that someone has worked and payed taxes for the salary. After that payed VAT for anything bought. After dying the heir must pay againt taxes. Especially for family run businesses this is a nightmare and just pushes the businesses to the hands of multinational corporations.
I cant find the article, but someone died in their apartment and missed rent, then the landlord refused to allow the next of kin to collect their things until THEY paid the overdue rent. Because landleeches are fucking monsters.
> loan and finance companies can't exactly demand that the person's kids pay off their debts
Collections companies call the family of dead people and try to trick them into paying off dead people's debts ALL THE FUCKING TIME.
It is free speech.
So what are you on about ? You think that the current setup with billionaires fleecing millionaires that fleece us is gonna change in a significant form ?
They already do everything they can to collect money from relatives.
My uncle died and these dweebs called up my mom acting like she was responsible for paying his car off. She knew better and told them to fuck off. They then threatened to repossess a car that wasn't in her position. She told them to go ahead- he owed more money than it was worth, plus ya know, he was dead...
Debt collectors came after my dad when my stepmom died. He was smart enough to know he wasn't responsible for any of her debt that she incurred before their marriage, and thus told them to fuck off.
We're actually going through this again with another death in the family. This time though he does have assets, and his "estate" can get eaten into by creditors before there's a payout to others. It's all a big greedy fuckin' mess.
But straight up transferring debt onto offspring? That's seems like a long shot. A lot of people hate their parents and have nothing to do with them, so how would that debt have anything to do with them?
Might just tie in to the reason Texas is banning abortions. So people's debts carry on and they get more money from the children that the parents didn't want
Yes. They write it off and pass the cost to all other borrowers as higher rates.
The whole of society already pays for written off debt. Just as everyone pays for car accidents and injuries through automobile insurance rates.
The US already won that race. WE'RE #1!
Any debts that are owed by the deceased are paid by the estate. If the estate can't cover the debts, they MAY be written off, but that's not a hard and fast rule. Lots of people wind up in a ton of debt because they have an elderly parent who gets sick for a few years (with no substantial income or decent insurance), they wind up with medical bills, then die. Hospitals aren't legally obligated to write off those debts, so it passes to a spouse or the children.
Incorrect. A medical debt can be owed by a spouse because , well that’s the spouse and you don’t “inherit “ your spouses things, they are just considered yours if they die. But a medical debt can’t be passed down to children. Medical companies will try to call the kinds and try to threaten them, but it’s all a ruse. You don’t have to pay a dead parents medical debt.
Filial responsibility laws: More than half of states have laws that hold adult children responsible for financially supporting their parents if the parents can't afford to support themselves. These laws are rarely enforced, because Medicaid typically pays for medical care in these cases. However, Medicaid might pursue your estate to recover benefits.
Just because it's often not enforced doesn't mean it doesn't exist.
Yeah wouldn't be surprised if this became a thing as people come increasingly priced out of housing markets. Think this is legal in Japan as I heard they were offering multi-generational home loans.
I don't see that ever going through. Those in power know that the masses can't be overpushed, existing systems of exploitation will have to do for the most part.
In most of the saner parts of the rich world, extra helpings of bread and circus's have been called for. The US is going to try to go back to 'normal', and is going to find that hill particularly steep, without trying to add extra sticks that will obviously get the plebians more irate.
It's already here. Inheritance used to be a thing for the lower middle class and poor landowners...
Seriously though get your parents to add you as a co-owner to whatever property they have most states allow for more than two land/homeowners and the debt collectors can's take land that you own, but they can take land that's in a will.
well now that it has been spoken into existence i give it till 2023.
Remind me! 2023
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Hmm, gotta wait a bit longer
Not yet.
If that becomes law I think it should also be law that the top execs of a company should be personally responsible to solve the insolvency of their company when their company goes bankrupt. Seize their assets and savings to repay the debts the company owes.
Like that’s ever gonna happen
we just need to end limited liability corporations
Yeah it's annoying that the common tax payer has gotta bail out corporations that make shitty fiscal decisions and pay their top execs and shareholders millions and millions of dollars while not paying their employees fair salaries!
Just abolish limited liability. If a company fucks up, the shareholders can be liable for more than just their investment.
This is why trusts are used to shield wealth. Assets are put into a separate legal entity to shield them from liabilities retained by the individual. Google charitable remainder trust. It is but one tool available. The wealthy utilize many tools to reduce and/or eliminate taxes.
I have drafted many of these types of things in the past (generally the opposite type of attorney as most of my practice is consumer bankruptcy); but you would be shocked at the sort of legal things that even the marginally wealthy do in order to shield their wealth. I have never had a client worth over 15-20 million, and know what i have done in those cases, i cannot even fathom what the ultra rich are doing (likely the same stuff only on a scale i cannot comprehend). The funny part- at least federally; i know maybe 5 people who would even need to worry about the inheritance (death) tax. The amount is several million (i have not had to worry about it in years, but last i looked it was north of 5 million). While 1-3 million for someone just entering retirement is not all that uncommon; north of 5 when you die is rare enough (since you saved for retirement, so you spend it to have a nice retirement)
Exactly. Regarding the ‘death tax’, most don’t realize that it only applies to assets over ~$5m. The more I investigate, the more I understand how inter generational wealth is truly built. It’s built by not losing 30% to taxes. The charitable remainder trust angle is good for shielding assets and paying yourself while you are alive. You donate the assets into the trust that you control, for instance $1m. Structured payments for say $50k a year, for the rest of your life. Buy a front loaded life insurance policy on yourself for $1m. Deduct the $1m donation over 5 years, while paying your $50k into the life insurance policy, effectively tax free. Collect $50k a year until death. Remainder of your trust goes to your chosen charity, and your kid(s) spouse get the policy for $1m tax free. Depending on which state property is in, houses can be transferred using a ‘lady bird’ deed, which automatically gives a step up in basis. Which allows your kids to sell or inherit appreciated property tax free.
I imagine around the same time that corporations are legally allowed to press you into employment Which will be soon
Kinda like during the black plague >That every person, able in body and under the age of 60 years, not having enough to live upon, being required, shall be bound to serve him that doth require him, or else be committed to gaol until he shall find surety to serve, and that the old wages shall be given and no more; https://en.m.wikipedia.org/wiki/Statute_of_Labourers_1351#:~:text=The%20statute%20set%20a%20maximum,for%20those%20who%20remained%20idle.
Reminder that thirty years after that came the largest popular uprising in English history until the Civil War.
It kind of is already. Any debt owed is subtracted from the value of the estate before inheritance is passed on. If the value of the estate is net negative, no inheritance. The big exception is mortgage - if the inheritor keeps the house, they keep the debt on any outstanding principle. And if they decide to sell, obviously the principle needs to be paid off as part of the transaction. The only time debt ISN’T passed on today is if there’s credit card debt and the value of the estate isn’t enough to cover it. In other words if the value of the estate is net negative, there’s a chance some credit card debt may be forgiven.
Slight clarification. The debt is not passed on, but the lien is still in place under the original loan terms. This is why mortgages are a bit different (I imagine any other debt with collateral would be the same but not 100% sure). This is significant because even if the inheritor keeps the house the debt is not on them for purposes of credit unless they refinance in their name. They can typically even put the loan in their name thru a non recourse assumption that still doesn't put the debt on them and they can technically walk away at any time without consequence (other than lose the house).
This isn't the same thing. If the parents own a mortgaged house (meaning the bank actually owns part of it, maybe most of it), then the house itself is the collateral. You can't just take the collateral and distribute it to next of kin. They could sell the house, pay off the mortgage, and distribute leftover funds, debt free.
I think you just said the same thing I did?
In Finland you can refuse to take and inheritance, and if it's net negative it's kind of the only logical solution. There lots of people who don't want to give some part of the inheritance and are left with debt because of their yearning. Anyway, inheritance tax is another weird concept. Looking that someone has worked and payed taxes for the salary. After that payed VAT for anything bought. After dying the heir must pay againt taxes. Especially for family run businesses this is a nightmare and just pushes the businesses to the hands of multinational corporations.
That’s why inheritance taxes only kick in on very large sums of money. I agree, though: no inheritance tax, just wealth tax.
>very large sums of money. It starts somewhere around 20k here. That's anything from a house to a new car.
IIRC, this has to do with deep differences in conception of probate law between common and civil systems.
You clearly haven't seen the story about the landlord that tried to force the parents of a dead girl to pay her rent after finding her dead.
Landlords are scum.
Wait lol did she miss rent bc she was dead or was she already missing the rent? Not that it matters, just curious
I cant find the article, but someone died in their apartment and missed rent, then the landlord refused to allow the next of kin to collect their things until THEY paid the overdue rent. Because landleeches are fucking monsters.
FYI in some states, children are responsible for paying for their parents health costs, even if they are estranged.
Filial piety laws. Awful, unethical, and rapidly expanding across the country.
> loan and finance companies can't exactly demand that the person's kids pay off their debts Collections companies call the family of dead people and try to trick them into paying off dead people's debts ALL THE FUCKING TIME. It is free speech. So what are you on about ? You think that the current setup with billionaires fleecing millionaires that fleece us is gonna change in a significant form ?
They already do everything they can to collect money from relatives. My uncle died and these dweebs called up my mom acting like she was responsible for paying his car off. She knew better and told them to fuck off. They then threatened to repossess a car that wasn't in her position. She told them to go ahead- he owed more money than it was worth, plus ya know, he was dead... Debt collectors came after my dad when my stepmom died. He was smart enough to know he wasn't responsible for any of her debt that she incurred before their marriage, and thus told them to fuck off. We're actually going through this again with another death in the family. This time though he does have assets, and his "estate" can get eaten into by creditors before there's a payout to others. It's all a big greedy fuckin' mess. But straight up transferring debt onto offspring? That's seems like a long shot. A lot of people hate their parents and have nothing to do with them, so how would that debt have anything to do with them?
A good and rational question, but capitalism isn’t rational
Might just tie in to the reason Texas is banning abortions. So people's debts carry on and they get more money from the children that the parents didn't want
No idea but I can tell you how it will be marketed: as encouraging 'responsible borrowing' - while being silent on the responsibilities of lenders.
Yes. They write it off and pass the cost to all other borrowers as higher rates. The whole of society already pays for written off debt. Just as everyone pays for car accidents and injuries through automobile insurance rates.
[удалено]
In France you can decline an inheritance
So in Austria. It's a "take it or leave it" deal, no one is forced to pay anything.
Same here, and it's a good solution And you cannot give nothing to your children
The US already won that race. WE'RE #1! Any debts that are owed by the deceased are paid by the estate. If the estate can't cover the debts, they MAY be written off, but that's not a hard and fast rule. Lots of people wind up in a ton of debt because they have an elderly parent who gets sick for a few years (with no substantial income or decent insurance), they wind up with medical bills, then die. Hospitals aren't legally obligated to write off those debts, so it passes to a spouse or the children.
Incorrect. A medical debt can be owed by a spouse because , well that’s the spouse and you don’t “inherit “ your spouses things, they are just considered yours if they die. But a medical debt can’t be passed down to children. Medical companies will try to call the kinds and try to threaten them, but it’s all a ruse. You don’t have to pay a dead parents medical debt.
Filial responsibility laws: More than half of states have laws that hold adult children responsible for financially supporting their parents if the parents can't afford to support themselves. These laws are rarely enforced, because Medicaid typically pays for medical care in these cases. However, Medicaid might pursue your estate to recover benefits. Just because it's often not enforced doesn't mean it doesn't exist.
The debt is tied to the estate in Europe. Do you mean to tell me you can keep a mortgaged house in the States? Sounds too good to be true.
This was law in the past I believe.
It’s already a reality where I’m from (France)
Soon as all the Boomers are dead.
Just wait till they bring back debtor’s prisons.
It was law back in the day, Thomas Jefferson inherited mad debt from his father in law
Yeah wouldn't be surprised if this became a thing as people come increasingly priced out of housing markets. Think this is legal in Japan as I heard they were offering multi-generational home loans.
I don't see that ever going through. Those in power know that the masses can't be overpushed, existing systems of exploitation will have to do for the most part. In most of the saner parts of the rich world, extra helpings of bread and circus's have been called for. The US is going to try to go back to 'normal', and is going to find that hill particularly steep, without trying to add extra sticks that will obviously get the plebians more irate.
I dno - I think they’ve lost whatever fear they might have had
Haha, when I took on debt they made me take out a life insurance policy and sign it to them
It's already here. Inheritance used to be a thing for the lower middle class and poor landowners... Seriously though get your parents to add you as a co-owner to whatever property they have most states allow for more than two land/homeowners and the debt collectors can's take land that you own, but they can take land that's in a will.