When estate planners have nightmares, do they dream that estates – inheritable chunks of wealth – have ceased to exist?Or do they dream that estate tax – the great estate-planning motivator – has been repealed?
In the wide-awake world, the first option appears alive and well for liberal thinkers. See Kevin Drum: Why Not Let the Dead Pay for Medicare?
Drum's post prompted The Atlantic's Megan McArdle to wonder, Why Do We Allow Inheritance At All?
Happily, estate planners need not toss and turn in their beds. After considering the obvious exceptions a 100-percent estate tax would require, not to mention the inevitable loopholes, McArdle ran into Chesterton's Fence.
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1 comment:
I really like Drum's idea of documenting lifetime total Medicare expenses. Most people don't appreciate how much more they get in benefits than they ever paid in.
I see the appeal of the idea of making the estate responsible to repay Medicare billings, subject to basis recovery or some such adjustments. The heirs might make different medical decisions for a dying parent if they have to bear some of the financial burden of that decision.
But the idea is fundamentally impractical. Too easy to plan around via lifetime gifts and jumbo life insurance policies. And the charities and museums would scream bloody murder at the practical elimination of the charitable deduction.
Loved Chesterton's Fence.
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