Estate taxation has led to harsh results for small businesses around the country, including community newspapers. In some instances, newspapers have had to be sold in order to pay the tax. When newspapers have to be sold to pay the tax, generations of newsgathering and service to the local community are irretrievably lost. Family newspapers are usually cash-poor and cannot pay a large tax penalty that can be as high as 55%, not to mention the local tax on decedent estates.

NNA supports estate tax relief since it penalizes small businesses including family-owned newspapers. Estate taxes provide less than 2% to the federal treasury. Economists believe that the costs incurred in enforcing the estate tax eliminate any gains in federal revenues.

Dozens of bills have been introduced in 1999 ranging from a complete elimination of the estate tax to an estate tax phaseout. On August 5, 1999 both the House and Senate passed a $792 billion tax cut which includes an eventual repeal of estate taxes. This bill, H.R.2488 passed mostly along party lines in both chambers. President Clinton has vowed to veto the entire package, but there is hope that there will be some kind of estate tax relief in the near future. Other bills devoted exclusively to estate tax repeal are stalled in either the House Ways and Means Committee or the Senate Finance Committee. Action may be taken on those following the summer recess.

In 1996, NNA worked with other organizations to provide needed relief from estate taxes. On July 31, 1997, Congress passed H.R. 2014, the "Taxpayer Relief Act of 1997." On August 5, 1997, President Clinton signed the measure into law. The law creates a new $1.3 million exemption for estate taxation for small businesses and family farms that qualify as family-owned. The exemption became effective January 1, 1998. Newspapers that do not qualify as family-owned under the law will also benefit from the law. It raises the amount exempted from estate taxation for that group from $600,000 to $1 million over a period of 10 years.

Today, NNA is part of the Family Business Estate Tax Coalition, which supports the bills passed in Congress calling for estate tax relief.

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