Law Professor Gerry Beyer’s Wills, Trusts and Estates Prof Blog has picked up on an interesting story about billionaire Warren Buffet which ran recently on CNN. Testifying at a recent Senate hearing, Buffet voiced his opinion that efforts to end the estate tax are misguided and wrong for a variety of reasons.

Buffet’s testimony is in agreement with articles which we have run here periodically over the past couple of years. As things stand now, most American families would not be faced with a tax burden when a loved one dies –only about one in 200 families would actually have to pay a tax which generates revenue which we would be hard-pressed to replace without new taxes.

Mr. Buffet labeled the phrase "death tax" as "Orwellian". It was coined by those wealthiest Americans who have attempted to gain support against the estate tax from the millions who will never be affected by it with a bald-faced mischaracterization.

Your blogger used to practice law with a former IRS agent. As a new agent working for the bureau, he once complained to his group chief that so many business owners were cheating the tax man by pocketing unreported cash that he did not know what could be done about this. "Don’t worry" he was told. "We get them when they die!". While this may seem like a callous approach, the fact is that billions of dollars in our underground cash economy find their way into real estate improvements, and other hard to detect investments which are ultimately revealed on a 706 estate tax return after the taxpayer’s death. One of the unspoken disadvantages of eliminating the estate tax is to lose forever at least some of the tax that is due on the unreported cash.

By the way, who on earth do you think gets stuck with that bill in the end ??