Thursday, November 13, 2008

Is Warren Buffett hypocritical on estate taxes?

Professor Edward Zelinsky asks the question, if Warren Buffett is such a fan of federal estate taxes, why has his own estate planning been arranged to dodge those taxes? He could have instead shared some portion of his immense wealth with the federal government, rather than give nearly all of it to Bill and Melinda Gates. Who, by the way, also are advocates for the federal estate tax who won't be paying it.

Evidently, Professor Zelinsky and I are in ageement.

Hat tip to Gerry Beyer's blog.
Posted by Jim Gust at 4:04 PM

3 comments:

JLM said...

Guess I missed something. Don't "modern conservatives" believe the federal government is so inefficient that it must be shrunk by reducing its tax intake? Do they really believe Bill and Melinda Gates to be more inept than the feds?

I'm also confused by the notion that Buffett's estate plan represents a tax-avoidance scheme structured by high-powered lawyers. As one of the comments appended to the professor's post notes, gaining the estate-tax charitable deduction for any desired portion of one's wealth couldn't be simpler: Just give it to charity.

Another comment to the professor's post made a pertinent point, though: Because Buffett's businesses include life insurance, he has incentive to root for the estate tax.

10:03 AM
Jim Gust said...

To reduce the tax take of the federal government, the better choice is to reduce federal taxes. Not to argue to keep federal taxes for everyone else and then arrange to not pay them yourself.

Another point, similar to the notion that Buffett's life insurance holdings are dependent upon the existence of the estate tax, is that he is in the business of buying distressed businesses. Nothing puts distress into a business like the estate tax, except perhaps a once-a-generation market crash.

11:02 AM
Oceander said...

JLM,

You did miss something - the most obvious thing of all - what conservatives decry most of all is hypocrisy, in particular the hypocrisy of those on the left who, while calling for tax increases on everyone else, are merrily using their high-priced lawyers to avoid (not evade, since most of the techniques are permitted - if you know where to look for them) those very same taxes.

8:35 AM

Post a Comment