The Lowell Sun provides a fairly comprehensive breakdown of the various tax relief votes in the Massachusetts Senate. Here’s their commentary on the estate tax/death tax (Old Colony Law tends to use both of these terms, despite their respective perceived political undertones):
Senate 5-33, rejected an amendment that would increase from $1 million to $5 million the amount of money that is exempt from the value of a person’s estate from the state’s estate/death tax that a person is required to pay following their death before distribution to any beneficiary. The increase to $5 million would be implemented over ten years.
Most Republicans are against any such tax and coined the name “death tax” to imply that the government taxes you even after you die. Most Democrats support the tax and call it an “estate tax” to imply that this tax is only paid by the wealthy.
Amendment supporters said that Massachusetts is one of only 12 states that have an estate/death tax and that the Bay State’s is the most aggressive of the 12. They said that in light of the high value of houses, with the average home price more than $500,000, the $1 million threshold of this “unfair and regressive” tax is too low and noted the federal tax exempts the first $12 million. They noted that Massachusetts is losing many residents, who move to Florida and other states where this tax does not even exist.
Amendment opponents said the proposed bill already raises the exemption from $1 million to $2 million and noted that will cost $185 million. They said a hike to $5 million is excessive and unaffordable and will cost hundreds of millions of dollars more. They noted that lowering the estate tax is not the only way to help seniors and their families and noted there are many other initiatives that help seniors.
(A “Yes” vote is for increasing the exemption to $5 million. A “No” vote is against raising it.)
NO: Sen. Michael Barrett; Sen. John Cronin; Sen. James Eldridge; Sen. Barry Finegold ; Sen. Cindy Friedman; Former Sen. Anne Gobi; Sen. Edward Kennedy. YES: Sen. Bruce Tarr.
This post is a part of Old Colony Law’s Estate Tax Updates.