But, the fact is that small businesses and family farms are, well, small, meaning they will never face the estate tax. Under the 2009 parameters, only about 100 “small farm and business estates” — those in which at least half their value comes from farm and business assets, with such assets not exceeding $5 million — would owe any estate tax in 2010, according to the Tax Policy Center.
Thus, the true effect of the proposal would be (1) to ensure that even more of the top estates in America will escape taxation and (2) to swell deficits and debt. It would allocate most of the tax cut to the nation’s largest estates. And it would cost the federal government an estimated $150 billion (including associated interest costs) over the first 10 years that it’s fully in effect - digging the fiscal hole from which the federal government will have to climb even deeper.
Our long-term deficits are large enough. Congress should reject dubious proposals that would make them worse.
• Robert Greenstein is executive director of the Center on Budget and Policy Priorities.
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