From USNews.com editor Kent Allen:
Two events this week -- the death of wine mogul Ernest Gallo at 97 and a Capitol Hill appearance by software mogul Bill Gates -- coincidentally brought to front and center the debate over the future of the estate tax.
The Gallos have been one of 18 very wealthy families that, according to Public Citizen and United for a Fair Economy, have been behind efforts to permanently repeal the tax. Under current law, the tax, which runs at about 45 percent for the value of estates of more than a few million, will be repealed in 2010.
But the following year the tax will revert to the 40 percent-plus range and with a much lower minimum threshold. Among the families not on the List of 18: the Gateses. Bill Gates himself told the Senate Health, Labor and Pensions Committee that he supports the estate tax. His father, Bill Gates Sr., has spearheaded action to retain the tax.
Gallo's death, meanwhile, could have relatively quick ramifications for the federal budget. While wealthy people can leave an unlimited amount of money tax free to their surviving spouse, Ernest Gallo's wife is already dead. If his net worth is the $1.3 billion that United for a Fair Economy says it is, then Uncle Sam could take a half billion or more of the estate (though this could be significantly cut depending on however much Gallo might have willed to charity; such gifts are not included in the taxable portion of an estate).
With no changes in federal law, had Gallo lived to 100 and died in 2010, the tax would have been zero.
Etc.: "Estate Tax" v. "Death Tax"--The Language of Politics, on USNews.com
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