SAVING MONEY BY GIVING IT AWAY
Here's What Is Behind
Estate, Gift-Tax Proposal
By CHARLES MOLONT
Washington, Feb. 10 W) The government collects less tax
money from large fortunes which are given away than it does
from fortunes which are inherited.
So a man with a lot of money can save his heirs tax pay
ments by giving them the money before he dies. .
The Truman administration
wants to make it cost about
the same in taxes, no 'matter
which way you do it
It also wants to break up a
system by which taxes on Urge
estates are saved for a genera
tion or two by setting up
"trusts" to pass the estates
along.
That's what is behind the ad
ministration's new estate and
gift tax proposal that and the
desire to get an extra $400,000,
000 in Taxes out of the trans
fers of wealth.
Under the trust system, a man
may leave his estate "in trust"
to his wife for her life (which
means she gets the income while
he lives) and then have the es
tate divided among their children.
Or he can stretch it out anoth
er generation by leaving the
property "in trust" to the wife
and then the children for their
respective lifetimes, with divi
sion among grandchildren after
that.
Outright transfers of estates
are taxed each time the proper
ty passes taxed at the death of
persons getting lifetime Income.
Using either the gift or trust
method to avoid taxes is as legal
under present law as taking in
come tax exemption for your
wife or child.
But President Truman and
Secretary of the Treasury Sny
der argue it's unfair, throwing
a heavier share of the overall
tax burden on other taxpayers
They put It this way:
The estate tax reaches only
about one of each 100 adults
who die, the same proportion as
ten years ago, while the income
tax hits 40 per cent of all people
over 14 years old about four
times the proportion ten years
ago.
money or property en tavej
taxes by giving at least part of
it away before their death be
cause the gift rates are 25 perl
cent less, and there are addition-!
al exemptions.
Farmer Income in
NE Oregon $5,440
La Grande, Ore., Feb, 10 U.R
Frank J, Barlos, supervisor of
the Farmers Home administra
tion here, estimated today that
average family-type farms in
northeastern Oregon grossed
$5440 in 1949.
Bartos said hogs produced
about 30 per cent of the total
farm income during the year.
He said operating expenses
averaged 46.7 per cent,
Bartos' district includes Union,
Wallowa, Baker, Umatilla, Grant
and Morrow counties.
The effective rates of taxes
have Increased sharply on in
comes of all sizes, but those on
estates have ben reduced for
married persons or, as Secre
tary of the Treasury Snyder put
it:
"The - tax on an income of
$10,000 has risen from four per
cent to 16 per cent. Tax on an
estate of $250,000 has fallen
from 11 per cent to four per
cent."
The estate tax hits few per
sons because any estate is tax
exempt on the first $60,000 or
$120,000 if that much passes
from husband to wife or wife to
husband.
Estate tax rates on amounts
left after exemptions range now
from 3 per cent to 77 per cent
there is $10,000,000 or more left
after exemptions.
People having that much
The Communicable Disease
center of the U.S. public health
service is at Atlanta, Ga.
Clearance!!
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Capital Journal, Salem, Ore,, Friday, February 10, 1955 S
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