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View Diary: Class Warfare: 18 Families financed Estate Tax Repeal Campaign (300 comments)

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  •  State level taxes (2+ / 0-)
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    drewfromct, CSI Bentonville

    Actually, the estate tax repeal really screwed with the states in a lot of ways.   Without getting too technical, most states' estate or inheritance taxes were tied to the federal tax in one way or another.   There were two changes made--the outright repeal for 2010 and then a change in the way that a federal deduction for state taxes is calculated--that effectively repealed many state taxes as well.   While the revenue for the federal tax is not huge, it is sizable for some states--in fact, here in Indiana, the inheritance tax is one of the main ways in which county governement is funded.

    So now, the Bush admin has forced states to decide to "decouple" their taxes from the feds, which essentially means state legislators are having to make an affirmative vote between keeping a unpopular tax and watching their states go bankrupt.

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