Federal Estate and Gift Taxes: Are They Worth the Cost?

1996 ◽  
Vol 9 (3) ◽  
pp. 295-302 ◽  
Author(s):  
Pat Soldano
Keyword(s):  
Income Tax ◽  
Capital Accumulation ◽  
Job Creation ◽  
Business Growth ◽  
Estate Tax ◽  
Estate Taxes ◽  
Federal Income Tax ◽  
Family Harmony ◽  
The Cost ◽  
The Impact

Everyone is aware of the federal income tax. What many do not realize is that federal estate tax may have a bigger impact than the income tax. While the income tax decreases take-home pay, the estate tax threatens job creation, business growth, and family harmony. This article examines the impact of the federal estate taxes and reviews several studies which indicate that the estate tax has a deleterious impact on capital accumulation, business growth, job creation, and federal tax revenues.

Is There a December Effect? Strategic Prepayments of Deductible State Income Tax

2010 ◽  
Vol 32 (2) ◽  
pp. 53-71
Author(s):  
John Shon ◽  
Stanley Veliotis
Keyword(s):  
Income Tax ◽  
Time Value Of Money ◽  
State Income Tax ◽  
Federal Income Tax ◽  
State Income ◽  
Tax Savings ◽  
Tax Payments ◽  
One Year ◽  
The Cost ◽  
Value Of Money

ABSTRACT: Individuals’ state income tax payments are deductible in the year paid for federal income tax purposes. This study investigates whether, and to what extent, individuals implement federal tax planning by prepaying state estimated income taxes before year-end, even though those payments are not due until January 15. Based on a study of 34 states’ aggregate data on estimated income tax receipts from individuals, we find strong evidence of this effect. We also find that this effect is increasing with the cost of state income tax payments. The results suggest that individual taxpayers take steps to reduce taxes by shifting deductions from one year to an earlier year and/or exploit the time value of money provided by accelerating federal tax savings by one year.

Les aides de la région wallonne à l'investissement après la réforme de 1992

Res Publica ◽  
1995 ◽  
Vol 37 (3-4) ◽  
pp. 427-4541
Author(s):  
S. Eggermont ◽  
G. Pagano ◽  
M. Tilman
Keyword(s):  
Job Creation ◽  
Investment Project ◽  
Investment Incentives ◽  
Allocation Of Resources ◽  
Domestic Investment ◽  
Foreign Investments ◽  
Total Percentage ◽  
The Cost ◽  
The Impact ◽  
Walloon Region

In 1992, the Walloon Region modified its investment incentive legislation. The new legislation applies the notion of SME to any business employing up to 250 people and which turnover does not exceed 20 million ECU, and replaces the former interest subsidies and capital premiums by a grant calculated as a percentage of investment. According to the size of the business, the activity sector and the area, the maximum aid may vary from 13 to 21 %. The grant total percentage is calculated by summing up the percentage of aid obtained for five criteria under which job creation is by far the most important (up to 8 %).  The new legislation gives a partial answer to traditional criticisms against investment incentives. First of all it aims at reducing the risk of accelerated substitution of capital for Labour. Besides, it simplifies adminsitrative procedures and reduces the "sprinkling" (spreading of the available budget over a large number of business which makes the impact by investment project almost negligible). It should also reduce the risk of inefficient allocation of resources thatarises when grants go to loss-making entreprises. But the question of whether investment incentives actually increase the level of investment (effectiveness) remains largely unanswered. Evidence suggests that investment incentives might have contributed to attract foreign investments hut have little impact on thelevel of domestic investment. Nevertheless, as far as SMEs are concerned, public grants might contribute to increased investment not by reducing the cost or increasing the profitability of the project but rather by increasing the means available in the business.

AN ASSESSMENT OF ENTREPRENEURIAL DISPOSITION AND CULTURE IN SUB-SAHARAN AFRICA: SOME LESSONS FROM GHANA

2018 ◽  
Vol 23 (01) ◽  
pp. 1850001 ◽  
Author(s):  
KWAME ADOM ◽  
NEWMAN CHIRI ◽  
DANIEL QUAYE ◽  
KWASI AWUAH-WEREKOH
Keyword(s):  
Capital Accumulation ◽  
Job Creation ◽  
Sub Saharan Africa ◽  
Youth Employment ◽  
Job Seekers ◽  
Negative Effects ◽  
Job Seeking ◽  
Youth Entrepreneurship ◽  
Sub Saharan ◽  
The Impact

This paper assesses the impact of Ghanaian culture on the entrepreneurial disposition of Higher National Diploma (HND) graduates of Accra Polytechnic from 2007 to 2012. Since the turn of the millennium, there has been more attention given to job creation than job seeking, especially among the youth, to address unemployment in developing countries. This is because of governments' inability to match the growing number of job seekers to job creation across the globe. One way to address this deficit in Ghana is the introduction of courses in entrepreneurship in almost all tertiary institutions, coupled with the setting up of institutions such as Ghana Youth Employment and Entrepreneurship Development Agency (GYEEDA), National Youth Employment Program (NYEP), Youth Entrepreneurship Agency (YEA), Youth Entrepreneurship Support (YES), among others. Reporting on 2015 data from Accra, the main finding was that collectivistic culture has negative effects on capital accumulation, human resource management and the urgency the unemployed graduates attached to self-employment. Therefore, this paper calls for some ways to address the issue of graduates' inability to be enterprising.

scholarly journals The influence of cost taxes on the development of agriculture in Slovakia

2012 ◽  
Vol 48 (No. 8) ◽  
pp. 359-363
Author(s):  
J. Bojňanský
Keyword(s):  
Income Tax ◽  
Point Of View ◽  
Tax Law ◽  
Important Impact ◽  
Insurance Funds ◽  
The Cost ◽  
The Impact

The author deals with the influence of cost taxes on the development of agriculture, mainly those taxes, which have an important impact from the point of view of forming an entrepreneurial environment in agriculture. Among the cost taxes, the impact of land tax, building tax, road tax and income tax is most important. The analysis also deals with the contribution to the insurance funds related to employees. This contribution can also be considered as a taxation. The article also gives a prediction of the expected development of the consequences of the accepted tax law changes.

The Changing Impact of the Alternative Minimum Tax on Horizontal Equity

2008 ◽  
Vol 8 (1) ◽  
pp. 39-65 ◽  
Author(s):  
Peter J. Westort
Keyword(s):  
Low Income ◽  
Income Tax ◽  
Horizontal Equity ◽  
Lower Income ◽  
Tax System ◽  
Rank Reversal ◽  
Income Groups ◽  
Federal Income Tax ◽  
The Impact ◽  
Income Taxpayers

While prior research (Anderson 1985, 1988) indicates that the Alternative Minimum Tax (AMT) increases the fairness, or horizontal equity (HE), of the federal income tax system, changes in tax laws and the general inability of the AMT system to account for inflation raise serious questions about whether the AMT continues to increase fairness. Burman et al. (2002) observe that the reason many more taxpayers are now subject to the AMT is because of the increasing divergence of the regular tax and the AMT. This divergence subjects more lower-income taxpayers to the AMT, thus resulting in higher total tax liability. Using individual income tax return data for 1992, 1995, and 2000, and both dispersion-based and rank reversal-based measures, this study observes that the AMT still increases HE in many upper income groups, but decreases HE in many lower income groups. Moreover, overall measures of HE indicate that the AMT has a net decreasing effect on HE. There are two implications to these findings. First, it can no longer be assumed that the AMT uniformly improves HE. Second, the AMT generally continues to achieve its intended result at the upper income levels. This result suggests that regulators and legislators wishing to improve the AMT system need to address the causes of low-income taxpayers being subject to the AMT while maintaining the impact on upper income taxpayers.

Impact of federal income tax rates and government borrowing on nominal interest rate yields on tax-free municipal bonds

2018 ◽  
Vol 10 (3) ◽  
pp. 342-350 ◽  
Author(s):  
Richard Cebula ◽  
Usha Nair-Reichert
Keyword(s):  
Interest Rate ◽  
Income Tax ◽  
Federal Budget ◽  
Nominal Interest Rate ◽  
Tax Rates ◽  
Budget Deficits ◽  
Content Type ◽  
Federal Income Tax ◽  
The Impact ◽  
Increasing Function

Purpose This study investigates the impact of federal income tax rates and budget deficits on the nominal interest rate yield on high-grade municipal tax-free bonds (municipals) in the US. The 58-year study period covers the years 1959 through 2016 and thus is very recent. Design/methodology/approach The study develops a loanable funds model that allows for various financial market factors. Once developed, the model is estimated by autoregressive two-stage least squares, with a Newey-West heteroskedasticity correction. Findings The nominal interest rate yield on municipals is a decreasing function of the maximum marginal federal personal income tax rate and an increasing function of the federal budget deficit (expressed as a per cent of GDP). This yield is also an increasing function of nominal interest rate yields on three- and ten-year treasury notes and expected inflation. Research limitations/implications When introducing additional interest rates such as treasury bills as explanatory variables, multi-collinearity becomes a serious problem. Practical implications This study indicates that lower maximum federal personal income tax rates and larger federal budget deficits, both act to raise borrowing costs for cities (of all sizes), counties and states across the country. Given the study period of 58 years, these relationships appear to be enduring ones that responsible policy-makers should not overlook. Social implications Tax reform and debt management need to be conducted in a very circumspect fashion. Originality/value No recent study investigating the impact of the two key policy variables in this study has been published.

scholarly journals The Impact of Capital Gains Tax Treatments on Optimal Livestock Enterprise Selection

1980 ◽  
Vol 12 (2) ◽  
pp. 139-145
Author(s):  
John T. Pounder ◽  
Richard A. Schoney ◽  
Gustof A. Peterson
Keyword(s):  
Income Tax ◽  
Capital Gains ◽  
Capital Gains Tax ◽  
Preferential Treatment ◽  
Short Term ◽  
Tax Rate ◽  
Federal Income Tax ◽  
Gains And Losses ◽  
The Impact

Current income tax provisions bear little resemblance to those enacted by the original law, the Revenue Act of 1913. Because of the progressive nature of the federal income tax, a need for special provisions for capital gains was recognized. In 1921, gains from the sale or disposition of capital assets and certain other capital items were identified and taxed differently from income from other sources. The capital gains provisions resulted in the separation of ordinary and capital gains income.Gains and losses from the sale or exchange of a capital asset and other capital items are classified as either short- or long-term, depending on the period of time the property is held. Income from items held for less than the required period is taxed as ordinary income. Income from items held for longer than the required period receive preferential treatment only if the net long-term gain exceeds the net short-term capital loss. If long-term capital gains are realized, 60 percent of the excess gain is claimable as a deduction; the remaining 40 percent of the net gain is taxed at the taxpayer's ordinary tax rate. If the net short-term capital gain exceeds the net long-term loss, 100 percent of the excess is taxable at the normal rate.

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