WASHINGTON — The U.S. House voted Thursday to repeal the Estate Tax, commonly known as the “Death Tax,” which takes nearly half of the estate of anyone who leaves more than $5.4 million in a will.
Reps. Robert Aderholt (AL4), Mo Brooks (AL5), Bradley Byrne (AL1), Mike Rogers (AL3), and Martha Roby (AL2) cosponsored the bill.
“When Ben Franklin famously quipped that life’s only certainties are death and taxes, I wonder if he realized this country would one day tax death itself,” Rep. Roby said in a press release Thursday.
“It is ridiculous that Americans who work hard, play by the rules and pay taxes on their successful earnings cannot pass along a family inheritance without the government taking almost half. I was proud to vote to repeal the Death Tax today, and I am glad we are one step closer to seeing it finished for good.”
The amount of an estate exempted from the Death Tax has been expanded significantly over the last several years, moving from everything over $675,000 being taxed at 55 percent to $5.4 million at 40 percent upon the death of the estate’s owner.
Republican proponents of repeal say the tax puts family farms and businesses in danger of being shut down because they can’t afford the bill, while Democrats say getting rid of the tax is essentially a tax break for the ultra wealthy.
During debate over the bill, one member of the House, Rep. Kristi Noem (R-SD), shared the story of how she had to drop out of college after her father was killed in a tragic farming accident. Rep. Noem’s family had to take out a large loan to save their farm.
Congressman Gary Palmer said situations like that should never happen.
“The bill we passed today would permanently eliminate the death tax,” he said. “This is long overdue. The death tax presents a significant danger to family farms and other small business. The death tax, originally created to fund the World War I, was intended to be temporary. I doubt it was ever good policy, but in any event, the purpose for it has long passed and it is time it meet its permanent end.”
Alabama’s only Congressional Democrat, Rep. Terri Sewell (D-AL7), voted against the repeal. With a final tally of 250-179, only 7 House Democrats voted in favor of repealing the tax.
The repeal will now move to the Senate, where it has historically been a favorite issue for Senator Richard Shelby.
“The death tax places an undue burden on our nation’s family-owned farms and small businesses, and it also has a negative impact on the desire of Americans to invest and plan,” Sen. Shelby told Yellowhammer Thursday afternoon. “Taxpayers save their entire lifetimes only to discover that their estates are subject to an exorbitant tax when they seek to pass their earnings and property onto their family and loved ones. I strongly support repealing the death tax to minimize the burden on the American taxpayer, simplify our complex tax system, and encourage long-term investments.”
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— Elizabeth BeShears (@LizEBeesh) January 21, 2015
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