FRIST’S FARM FAMILY….Since the estate tax debate began in earnest, congressional Republicans have highlighted what they see as the tragic consequences of the estate tax. As a rule, they point to hypothetical horror stories, but are usually a little short on actual examples.
Senate Majority Leader Bill Frist (R-Tenn.), however, claims to have found a real-life incident about a family in his home state. This is from an email Frist sent to his supporters on Wednesday:
“I am reminded of a case in Williamson County, TN. I know of a family there that inherited from their dad the 167 acre farm that they grew up working on. The kids considered keeping the farm … until they got the ‘inheritance tax’ bill, which typically runs 40 to 50% of the current market value of a property in excess of $1 million.
“The children needed to come up with hundreds of thousands of dollars within mere months of their dad’s death. Like so many other families who inherit the family farm, they simply couldn’t do that without selling the land.”
Something doesn’t quite add up. First, Frist is just wrong about the amount at which the estate tax kicks in. The senator’s email mentions “property in excess of $1 million,” but as MarketWatch’s Marshall Loeb explained this week, the portion of an estate that is automatically exempt from any federal taxation is $2 million (or $4 million per couple).
Second, Frist said grieving kids had “mere months” to pay “hundreds of thousands of dollars” to the government. At a minimum, this is misleading. The law says the estate tax is not due until at least nine months after a person dies, and in some cases, heirs get years.
Third, when Frist noted that the estate tax “runs 40 to 50%” of an estate worth more than $1 million, he’s not only wrong about the dollar amount, he’s also wrong about how the tax is applied — it affects an estate’s value over and above $2 million, not the whole thing.
And, finally, as Crooked Timber’s Ted Barlow told me, it’s rather disingenuous for Frist to claim that the tax hits “so many other families,” considering how much trouble Republicans have had finding real people who have had to sell their family farm because of the tax.
So, in the end, Frist appears to be have been wrong about … nearly everything. Here’s a final thought: why would the Senate Majority Leader and likely presidential candidate put all of these errors in writing?