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Impact of Estate Taxes on Farmers Family business assets are a small fraction of taxable estates. While family business assets are very vulnerable to estate taxes, most of the assets subjected to estate taxes are not part of a family business. The majority of estate tax revenue is paid by a relatively small number of individuals (estates). Those with estates in excess of $5 million make up less than six percent of taxable estate tax returns, they pay nearly half (48%) of all estate taxes - and most of this does not represent family business assets.25 Even among those with estates larger than $5 million, less than one-fourth (23%) of the wealth in their estates consists of family business assets,24 based on the assumptions used in Table 5. It is important to note that this amount does not account for assets moved out of owners' estates to avoid estate taxes. It also does not include assets transferred to the next generation prior to death on which estate taxes have already been paid. Thus, the added flexibility for family business owners which would occur if estate taxes were eliminated would likely be greater than that indicated by these data. | |
