As the old cliché
goes, in this world nothing is certain but death and taxes. Unfortunately,
this double whammy hits many Americans at precisely the same time
in the form of estate taxes, or as we farmers call it – the
death tax.
The hardest
hit
Farm Bureau supports full and final repeal of the death tax. Year
after year, Farm Bureau members consistently list it as the organization’s
top tax priority because of its potential to prevent families from
passing their farms onto their children.
Regrettably, many farm families barely have a chance to mourn the
loss of their loved one before they are hit with exorbitant taxes
that can force farmers to sell off chunks of their land, the very
land that is used for their livelihood.
Farm and ranch estates face heavier and potentially more disruptive
death tax burdens than other estates. In the late 1990s, roughly twice
as many farm estates paid federal death taxes compared to estates
in general, and the average tax paid by farms was larger than what
was paid by most other estates. Unlike wealthy Americans who set up
trusts and sell off stock to pay estate taxes, farmers lose their
land.
Yet, even with that evidence, critics continue to question the authenticity
of our convincing case against the death tax. They want victims…
Here is a prime example. Farm Bureau member and Oregon timber rancher
Neil Westfall was willed, along with his father and brother, his great
aunt’s ranch, valued at around $900,000. During the following
15 years, the Westfalls paid estate taxes totaling $750,000. Later,
upon Neil’s father’s death, the Westfalls shelled out
another $200,000 to settle the estate for a grand total of $950,000
– $50,000 more than the original worth of the ranch! In effect,
the Westfall family ended up buying from the government their fourth
generation ranch that was given to them.
There are more examples of farmers like Neil Westfall. Unfortunately,
that doesn’t appear to be enough for a number of powerful and
wealthy Americans who fare better with a death tax in place.
Some don’t
get it
I recently read a parable by Bill Gates, Sr., (you may recognize his
name, his son is the founder of Microsoft). In his parable, Gates
told of two souls in line for birth who were told one would be American
and one would not. God asked them to think about how much of their
accumulated wealth they were prepared to give back at the end of their
lives to earn that right. Gates suggested the correct answer was all
of it, saying, “that’s what its worth to be an American.”
Gates and his group, Responsible Wealth, believe the tax promotes
equality and supports democracy by slowing the accumulation of wealth
and power in the hands of the few. They argue that 98 percent of Americans
pass their estates on tax-free, and that all the estate taxes in 2000
were paid by Americans with estates larger than $5 million. Tell that
to Neil Westfall.
Gates has repeatedly publicly attacked the Farm Bureau for its stance
on repealing the death tax. He suggests that farmers are being used,
held hostage by advocates of the repeal. He has gone as far as to
insult the intelligence of farmers by suggesting they are not informed
about the issue. I bet Mr. Gates would be hard pressed to find a group
of Americans more informed about the unjust consequences of death
taxes than those farmers living its ramifications.
For myself, along with the farm and ranch families of Farm Bureau,
being American does not mean forfeiting the family farm to the government.
Instead, it is knowing that every American can contribute to their
country without being penalized for their hard work and success. It
is the reassurance that when our life on Earth is complete, our years
of hard work and way of life will be passed on to our children so
that they can follow in our footsteps, just as many of us followed
in our parents’ footsteps.
For Neil Westfall and other farmers and ranchers, being able to pass
along that dream to future generations is what its worth to be an
American.
