I run this video for two reasons. The first is that this is probably an example of the kind of citizen journalism we are going to see more and more of. The second is that the single point being made is valid but has never been so emphasized by the mainstream media which should hound Kennedy over things like this instead of coddling him and the rest of the politicos.
And, I should mention, all the hyper-rich Democrats I know also manage such tax avoidance.
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I agree, but here is the quibble==the story would actually have teeth if it got into what those “trusts” are all about. You indeed have to “follow the money” to get the whole story. This was only the start.
Anybody know Kennedy’s position on abolishing the estate tax altogether?
Bill Gates, by the way, is doing the same thing with good press. His trust is trying to prevent malaria among many other things. Is that bad?
Laws are my BY them FOR them. Helloooo???
Bobbo – you missed a point… Kennedy is and has long been in support of an estate tax.
But what the Kennedy family does is legal. What Gates does is legal. These legal mechanisms are available to ALL individuals and families with money. ANYONE can do what the Kennedy family does.
If one opposes the estate tax… set up a damn trust… put all your stuff in your kid’s name… do something… it’s legal… you are allowed.
—–
This might be “citizen journalism” but its also ambush journalism and we learn nothing of value from it. It has its place, to be sure, but in this case the point is to smear Kennedy… not to answer what seems like a legitimate question.
One thing that separates a journalist from a thug is that the journalist cares as much about the answer as he does the question.
#3–OFTLO==yea, stupid on my part. It was rather the point of the ambush wasn’t it? The body of my post is still valid though?
Or–Kennedy “says” he is for wind energy but he fights the installation of towers in his backyard.
Maybe the question of his actual legislative history is still valid==but hopefully not.
What is there to admire about ANYONE in the Kennedy family, going all the way back to Papa Joe, the bootlegger who also sold to the Nazis in WWII. To my dying breath, I will NEVER understand the love affair with this POS family. JFK was the very best of a mostly bad lot.
I have looked into this whole business of trusts and estate taxes, and although it is legal, it is also beyond the reach of us regular Joe’s who want to leave something for our kids. It takes a lot of money to create and maintain the type of trust which would circumvent the estate tax law.
You have to create an irrevocable trust and place the assets you want protected in this trust. The trust has to be created by someone who knows what they are doing, and the beneficiary structure has to be absolutely correct.
That takes money. Usually a LOT of money. And then you have to pay the trustee. $5,000/year is a minimum for trusts of any substance.
And you can never dissolve the trust because if you do, the recipients of the resulting funds will have to pay the estate tax!
So, in a nutshell, if you want to pass along, say $300,000 to your kids, either you get hit with the estate tax, which eats away half of the money, or you create a trust and pay those fees, which isn’t much better. And remember, you still have to pay income tax on whatever earnings you receive from the trust.
Ergo, for most of us, we’re hosed either way.
#6–Ah Yea==are you sure the tax doesn’t start at 2 Million AFTER deductions and exclusions?
http://tinyurl.com/2ddtv2
#6 – Okay… But isn’t that all true no matter what size the estate is? And thus, ultimately, a tax does get paid?
If you are leaving everything to your kids, is it safe to suggest that you trust your kids? Couldn’t you transfer ownership while alive… “give” it to them?
#7 Who cares? It’s money you and your family already paid taxes on. Double dipping is insane. Just like taxing SS benefits.
Might be ambush journalism but that’s what you get when the lame stream media is buddy buddy with these corrupt politicians and who don’t confront these politicians on their own hypocrisy. Many politicians will only be interviewed when they know the questions before hand (cough cough hillary clinton).
We have come to a time where we need to stop putting up with these corrupt politicians. We deserve accountability. The only way that will ever happen is with another revolution as the DC has become a monster that can not be reformed.
One could call this ambush journalism but that’s what you get when the lame stream media is buddy buddy with these corrupt politicians and won’t confront these politicians on their own hypocrisy. Many politicians will only be interviewed when they know the questions before hand (cough cough hillary clinton).
We have come to a time where we need to stop putting up with these corrupt politicians. We deserve accountability. The only way that will ever happen is with another revolution as the DC has become a monster that can not be reformed.
I think the “reporter” may be confusing legal tax avoidance with tax evasion and the airy subjective “spirit” of the law. I’m sure Kennedy follows the law exactly as written.
Hopefully Kennedy won’t ever advocate laws for driving on the left side of the road because, what?, immediately he’d have to drive on the left side of the road in the spirit of his proposal?
If a tax law isn’t working as planned, blame the incompetence of all the lawmakers who voted for it.
That said, if some money is yours, and the tax has already been paid on it, you sure in heck should be able to squander it in whatever way you like.
To just take it is legalized theft. The real driving force of succession laws is basic human greed and jealousy. They have it, you want it. Next there will be taxes on healthy people for being inequitably more fortunate.
If equality is the principle here, then we should all pay the same amount of tax. In which case I sure don’t hear anybody ever thanking rich people for ponying up more than their share.
And if you can cite rich guys who pay no tax, look a little closer and you will see that the tax laws are designed to leverage even more of their personal money into favoured government endeavours.
RBG
#9–pat==everybody knows that tax policy is used for many reasons besides just raising money. Preventing multi-generational dynasties is one of them. Its not the worst thing government does==the worst thing is having the mechanisms in place that allow such estates in the first place.
POWER TO THE PEEPLES!
And did you catch our “investigative reporter’s” oh-goody-I’m-going-to-be-on-YouTube proud little smirk at the end?
RBG
#12 – “the worst thing is having the mechanisms in place that allow such estates in the first place.”
Earning money?
Too bad Teddy did not drive a Volkswagon Beetle across the bridge at Chappaquiddick. He might have been President.
(p.s. VW bugs float)
#13–RBG==when is the last time you smiled?
#14–pat–yes, the concept of “earning” gets slippery at the extreme.
#15 – He is an “interesting” character.
I remember one night in Nov 2002 I was sitting in the lounge at the Hotel Royal Monceau in Paris. I could see the entrance and in walked this gorgeous
blonde who was about 18. Trailing her and holding onto her hand was Teddy. He was staggering & drunk. He has good taste in women though.
Fill in your favorite Massachusetts joke:
* Ted Kennedy
* John Kerry
* Barney Frank
* Harvard and the libs
* Boston Mayor Mumbles Menino
* the Bulgers
* Mike Dukakis
* Provincetown
* gay marriage
* Chappaquiddick
* gun toting Mass Pike toll takers
* People’s Republic of Cambridge
* $15 billion Big Dig Tunnel o’Death
#3 OFTLO – I agree with you (for a change). It is something I have looked into for our meager estate.
Some relatives of ours gave everything to their children 10 years before the parents deaths just to keep the government from getting their greedy little hands on it.
All done legally.
# 9 pat
“Who cares? It’s money you and your family already paid taxes on. Double dipping is insane. Just like taxing SS benefits.”
It is not double dipping. When money transfers from one entity to another it is called income!! The parents leaving money to the children is money transferring from one entity to another. It is no different than when your company write you a check. It is called income. They paid when they earned it. You pay it when you earn it. Is that double dipping?
You are not paying an “ESTATE TAX” You are paying income tax.
#21 J – “It is not double dipping. When money transfers from one entity to another it is called income!! ”
Not always. It can be considered a gift (no tax) if it is handled properly.
If you are married and your parents were/are still alive each one could give each of you $10,000 (it might be up to $12k now) on Dec 31 and do it again on Jan 1 for a total of $80k non-taxed because it is gifted.
If I’m wrong I am sure that someone will tell us.
#21 So how much out of a given dollar should the gov’t get? 50%, 99% My children are part of the same entity as myself while I’m raising them. The income gets taxed for that “unit”.
16. Bobbo. The last time I smiled? I laugh with a hearty guffaw each and every time I have the pleasure of reading my own words exposing the putrid lying underbelly of indignant fraudulent men… on DU.
RBG
# 22 Steve-O
Yeah I was tying to be general as possible as to not complicate the issue but yes you are right. The gift tax is now $12,000 per person per year I believe until 1 million has been reached. Or it can be a one time 1 million gift.
Not sure where you got the $80k from.
I do agree with #3. It’s an ambush, you can see on the “kids” face how happy he was with the results of his being super smart.
The reality is, those complaining about the system, don’t understand the system. I see nothing illegal OR morally wrong with what he’s doing.
He’s still creepy, etc… but doesn’t mean he’s wrong. I would also agree that I would love to see a response or vs to get this cleared up. I’m sure the smart-ass kid would get put back into his place.
What’s that smart-ass kid done for the world?
# 23 pat
“My children are part of the same entity as myself while I’m raising them. ”
No they are not. They are a seperate legal entity as they can earn income seperate from you even if they are 1 year old in the case of a baby model. You and your wife, if you have one, however are a single entity. This is because you sign a contract with your state as such.
On #21 and #22, here we get to the core of the debate.
If you parents socked away some money after taxes, and then you inherit that money when they die, you get to pay tax again on money which is after-tax income. It therefore is double-taxation. There is a limit to gifts. This loop-hole was plugged a long time ago.
This is also the answer to #8. Although the estate tax doesn’t kick in till the 2 million dollar threshold, inheritance less than that is taxable as income.
There’s the rub. Taxes on inheritance in general is double-taxation. It is paid by the parent when it is earned, usually as income, and taxed again by the recipient, either as estate tax or income tax.
There are exceptions. The best thing to do is find a really good tax guy. A competent CPA/Tax Lawyer is worth his weight in gold when dealing with issues such as this.
#14 – #12 – “the worst thing is having the mechanisms in place that allow such estates in the first place.”
Earning money?
I’m going to ignore the knee-jerk criticism I’ll inevitable hear about this, but…
In many cases, the definition of “earning” has to be very flexible to apply.