April 3, 2023

Grieving Taxpayers Shouldn’t Have to Pay on Loved-One’s Nest Egg: Repeal the Death Tax

A permanent repeal on the death tax would help America’s family businesses create jobs, expand operations and grow the economy.

In a joint letter, 150 associations─including Western Growers─voiced support for Sen. John Thune’s Death Tax Repeal Act of 2023. The letter highlights reasons why the death tax should be repealed. A key feature being that the death tax actually has a higher overall cost than the revenue it generates. As stated in the letter, “The death tax contributes a very small portion of federal revenues. The estate tax currently accounts for approximately one-half of one percent of federal revenue. There is a good argument that not collecting the estate tax would create more economic growth and lead to an increase in federal revenue from other taxes. A 2016 Tax Foundation analysis found repeal of the death tax would increase federal income taxes by $145 billion over 10 years using a more realistic, ‘dynamic’ economic analysis.” Along with greater federal income tax, the Tax Foundation also found that repealing the estate tax could create over 150,000 jobs.

Congress should be doing everything possible to help make transitioning to the next generation of ownership as painless as possible for family businesses. “It makes no sense to require grieving families to pay a confiscatory tax on their loved one’s nest egg,” says the letter. “Far too often this tax is paid by selling family assets like farms and businesses. Other times, employees of the family business must be laid off and payrolls slashed. No one should be punished for fulfilling the American dream. The negative effects of the estate tax make permanent repeal the only solution for family businesses and farms. [Thune’s] legislation will help America’s family businesses create jobs, expand operations, and grow the economy.”

A full copy of the Family Business Coalition letter is available here: Letter to Sen. John Thune