Mark Udall

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Mark Udall

Udall working to change estate tax that could affect Steamboat ranchers

US senator says expiration of tax cut, return to 2001 levels ‘not sustainable’

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— U.S. Sen. Mark Udall said Thursday that he and other senators are drafting a bill to address an estate tax situation that has some landowners concerned about whether they’ll be able to afford passing on their assets to kin.

The federal es­­tate tax, known by detractors as the “death tax,” is assessed on the value of a deceased person’s estate, above an exempted amount. A significant reduction of the tax is scheduled to expire at the end of this year, meaning tax rates and exemption amounts could reset Jan. 1 to higher levels in place a decade ago.

The heirs of so-called “land-rich, cash-poor” ranchers, or of business owners with large assets but small income streams, for example, could face a tax that is based on the value of those assets and is much greater than their income.

There is no estate tax on the assets of those who die this year. The difference between dying this year and dying next year — as the tax stands — could mean tens, if not hundreds, of thousands of dollars.

“It’s a huge difference as to whether someone passes away Dec. 31 or Jan. 1, 2011, as far as how the estate is treated,” Routt County Commissioner Doug Monger said.

Monger, a rancher, acknowledged that he has a personal stake in the issue he recently met with Udall to discuss. If the estate tax is allowed to expire in its current form, any estate worth more than $1 million will be taxed next year on value in excess of that amount.

Assuming land values of $20,000 per acre, Monger said, any owner of more than 50 acres could have a valuation of more than $1 million and face an estate tax on the remainder.

“The cattlemen and cattlewomen and ranching families have concerns about that,” Monger said. “It affects a lot of people — even more than ranchers.”

The phased estate tax re­­duction was part of former President George W. Bush’s massive tax cut package in 2001.

Udall, a Colorado Democrat, said Thursday that the situation “is not sustainable.” He said a change is needed to help landowners “keep their lands in their families without worrying about taxes.”

“I believe before the year is out, we will have a tax package that includes extenders, or other adjustments … in the tax code,” he continued.

Udall said work to draft a bill is ongoing and that he could have an update next week.

President Barack Obama’s administration made a proposal last year that would have reinstated the estate tax’s 2009 levels — and implemented the tax in 2010 — but that proposal was never made law, and the issue remains undecided.

Udall said exempting estates valued at less than $3.5 million for one person, or $7 million for a couple, could make sense.

“I think that would be a smart way to put in place a permanent fix for the estate tax,” he said.

He acknowledged that tax changes could be “one of the last pieces of business” Congress takes on this year. The changes could present some legislative challenges, he said, as Congress works to reduce the national deficit and address the expiration of Bush-era tax cuts.

Paul Strong, an accountant, former Steamboat Springs City Council president and active member of the local Republican Party, didn’t mince words Thursday when joking about tax cuts set to expire Dec. 31.

“This is the year when if you’re old and rich, you kill yourself,” Strong said.

Comments

seeuski 4 years, 4 months ago

Looky here, we have the Dems acting like Conservatives. It is not sustainable, is that the word of the year or what with these Democrats? I guess by using that language not sustainable at this point after we have heard it for the last year or so in the Dems description of everything George Bush, we will feel good about keeping a tax break that was part of the George Bush era. Something is not sustainable so we must "change" it, as if it were George Bush's fault all along. NO! Stick with the program Dems, you campaigned on ending the Bush tax cuts for the rich and 1/2 the Country fell for it. But oh, that isn't for everyone least not Udalls constituents, he must get reelected soon don't forget and then the tax cuts won't be sustainable again. Watch out people, fool us once, fool us twice? I hope not.

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jimmmmmm 4 years, 4 months ago

Way to stay true to form Seeuski-unbelievable. Can you just stop to think for a moment, or would that get in the way of your crusade?

Eat your cream of wheat, and curl up on the couch for some good Cluster Fox hate mongering.

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seeuski 4 years, 4 months ago

The truth hurts doesn't it jimmmmmmmmmmmmmmmmmbo? And this news is not on FOX yet. Any of your favorite comedy news sites reporting on the soon to be 51st state Peurto Rico vote in Congress 2 days ago? NO! So there is your news, nice and controlled as you like it. Party on dude. P.S. Did you think I would not see the hypocrisy in this Udall move? Come on. All of you Dems demonized Bush for these very tax cuts and now that they are going to end the effect is becoming real and you want to "change" back because it is "unsustainable"? Spare me.

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jimmmmmm 4 years, 4 months ago

I'm not sure any Democrat opposes a tax on a family that inherits a farm, because it unfairly taxes a family that can't afford the imposed tax. You, as always, just want to bash away-you can't admit that what Udall is proposing is a good idea-for the people this would directly affect. Instead, in your mind and Glenn Beck's, this is just part of the grand progressive agenda.

No, you spare me.

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seeuski 4 years, 4 months ago

Lets see now, you want some of the tax breaks from the Bush era just not the ones that directly help people you don't know or care about. Don't you see why Socialism won't work and will destroy the futures of all families? You make my point for me, I don't have to work very hard on this argument. Keep the big Government ideals out of our lives and stop this Socialist agenda and then we can all enjoy the rewards of a free market economy and not worry about people losing their family inheritances or their JOBS. FYI, I have been spending some time this morning at the Democratic Socialists of America website reading their minutes from meetings over the last 4 years. If you want to see how Obama has come to lead just read their goals and action plans. No, Obama is definitely not a Socialist.(sarcasm added) He just happened to be a member of that group in the mid to late 1990's and that group was active in his campaign. Shoot the messenger but it is all available for those that care to seek it.

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seeuski 4 years, 4 months ago

Barrack Obama was a New Party member.

"Barack Obama, victor in the 13th State Senate District, encouraged NPers to join in his task forces on Voter Education and Voter Registration." http://www.chicagodsa.org/ngarchive/ng47.html

http://www.chicagodsa.org/index.html

http://www.chicagodsa.org/page2.html

I wonder, how could the media have covered up these Socialist connections so well before the elections of 08? Well we know now for sure.

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Fred Duckels 4 years, 4 months ago

This tax situation is for everyone not just ranchers. It helps avoid selling the inheritance to pay the taxes. It allows many small businesses to be handed down rather that liquidation.

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seeuski 4 years, 4 months ago

That was my point earlier Fred, and I am still waiting for jimmmmmmmmmmmm and his next brilliant response to that. These entitlement programs like the Health Care for all ideal requires the Government to take these assets from their rightful owners just to cover a large portion of the cost, fraud and waste that is inherent when the Government runs businesses. GM just paid back 6.7 billion dollars it owed all of us, they used our money from another fund to do it. That is robbing Peter to pay Paul at the highest level. What is wrong with Americans who just bury their collective heads in the sand to all of these deceptions?

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Troutguy 4 years, 4 months ago

Seeuski, is it not the "free market" that you so long for that helped get us into this financial mess in the first place? Free markets look good on paper, but it doesn't account for the greed factor that ruined our economy & put millions of people out of their JOBS. We need to find the middle ground with both regulation and free markets. Deregulation over the last 20 years from both sides of the aisle is what helped drive our economy off the cliff in the first place. We need to make sure this doesn't happen again.

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seeuski 4 years, 4 months ago

troutguy, Do you think the whole world is dumb enough to go along with that mumbo jumbo you are trying to pass off? We all know it was Government regulations that got us into this worldwide mess. Ever heard of Fannie Mae? Look it up. maybe read Sowell and learn something. There is no middle ground, there is Socialism and there is free market Capitalism and you either believe in Socialism or you are swallowing the talking points hook line and sinker. No offense if you are not a Socialist.

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Troutguy 4 years, 4 months ago

If over- regulation caused this mess, we should have had another financial meltdown soon after the Depression. Funny thing is, we had nothing of this magnitude until the deregulation train left the station in 1999 when the Glass-Steagall act of 1933 was repealed. Before that, I think we were doing o.k. with some regulation, some free market. Again, free markets would work great on their own, but people get greedy and hence the need to regulate this greed. Do we not need to regulate the mining industry, see Upper Big Branch Mine, or regulate the oil industry, see Deepwater Horizon in the Gulf Coast. Or should we just let industry police itself?

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ybul 4 years, 4 months ago

Unfortunately even those who rail for free markets want low interest rates, when I hear our leaders speak. The underlying component of a free market is a free and unfettered monetary system.

Right now we have a highly regulated banking system which helps to line the pockets of those closest to the creation of debt or money. Our government in its intervention into the subsidization of grain, housing this that or the other has put us in the place we are in.

Regulation and ensuring that one does not tread on the private property rights of others is the primary function of government which it has not done. In order for a free market to function to operate properly you need oversight to ensure that one does not tread on others private property. This in that we have trucks belching diesel emissions into the environment which causes asthma in the inner city after prolonged exposure.

So the government is failing to internalize the production costs of these operations and as such is failing to uphold the basic needs of a free market to function effectively.

The government in subsidizing home loans as See has stated has helped to create the problem, this coupled with the federal reserve trying to stimulate the economy by keeping interest rates artificially low helped create the mess we are in today. INTERVENTION has created the mess we are in today not simply greed, though that greed coupled with the ability to manage interest rates and guaranteeing pensions or mortgages.

We did not get into this mess with free markets we got into it via manipulations, regulations and government guarantees that have distorted a free market.

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housepoor 4 years, 4 months ago

yvboy, yeah my groceries come from million $$ 5ac ranches in strawberry park and along river road that pay someone to hay it for 3 bales...saving them thousands in property taxes

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housepoor 4 years, 4 months ago

they do have have ag status....do your homework...the income standards are what amount to selling one bail of hay leasing a 2ac pasture to one cow........call the assessor the assessor's webpage list 758 parcels that have residences and are 40 ac or less that have ag status..245 of those are less than 20........how much income can you produce on 40 ac, let alone 20?

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ybul 4 years, 4 months ago

I know someone in southern colorado grossing about 50K on her 5 acres.

There may be something wrong with a McMansion using a loophole not to pay their fair share, but to claim that 5 acres can not produce significant farm income is just not true.

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seeuski 4 years, 4 months ago

ybul, Your expose above of how the Congress used regulations to create the housing bubble in the transfer of wealth scheme which started with the Community Reinvestment Act under Carter is spot on. Of course I added some detail but I agree with you. It really gets old when people like housepoor argue, probably from the heart as they believe what they think is right, the anti free market talking points. It was the very Government who regulated us into this mess that they now want to give more power to. Ignorance is bliss until the truth hits you over the head but history revisionism is dangerous and what is being used to influence public opinion. People need to seek the truth and leave the politics aside so we don't go down this road again. In today's paper there is a story about the YVHA giving bigger interest tax breaks to first time homeowners. Aside from how that made me feel as not being a first time homeowner and unqualified to receive the same tax break, I can't believe they are continuing the same practices of the Community Reinvestment Act even after the recent housing bubble. We can vote for change this November and help secure the future for the kids that rely on us adults.

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housepoor 4 years, 4 months ago

There is no income requirment. YVB speaks of which he doesn't know.
I have no issue with legit farmers claiming ag status regardless of the size.

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seeuski 4 years, 4 months ago

YVB, Immigration has already effected a lot more than our taxes, it is effecting a growing divide in this country between the citizens who want the Feds to exercise their Constitutional mandate to protect the borders and keep us sovereign and those that want to play the race card because it feels good attacking those racist Conservatives who hate brown skin people. But when one looks more deeply at what is in play here we have the Laraza movement associating with the (SEIU)Global Union movement to effect public policy and using that for their long term goals as you said earlier, taking back what they say is Latino land. I think that is the whole western territory of the US. How many children of illegals are receiving a free education in our school systems throughout the US? and how many receive all the bennies of normal taxpayers without paying any taxes at all? The article about the necessary reduction in the school budget over the next few years should be alarming to those making such claims of racism against those of us who support the rights of states like AZ to step up the duties of Police in enforcement of laws already on the books. Lets use the term "unsustainable" where it belongs, in the Feds inaction over the last 2 decades to protect the borders and hammer out an immigration policy that is fair to both the US citizenry and those that wish to come to America. Bush tried and was hammered from both sides and what we may get from the current Administration scares the heck out of me.

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JLM 4 years, 4 months ago

There is absolutely no reason to tax a second time "after tax" dollars held in assets which are bequethed to a beneficiary.

Why should death be a taxable event?

The whole idea is silly and nonsensical.

A guy earns money, pays taxes, uses the after tax dollars to buy something when he dies the property purchased with after tax dollars is taxed a second time?

What sheer utter nonsense!

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pitpoodle 4 years, 4 months ago

So Udall has come to the realization that tax breaks are not demons straight from the Republican Party. His polls must tell him he's on the wrong side of the voters, so he'll repent for the moment. It may be too little to late. Oh well.

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greenwash 4 years, 4 months ago

End the 35 acre ag status BS.

35 acres is not a ranch.Its Rural Sprall.

"Like a Dimestore Cowboy"

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Cooke 4 years, 4 months ago

@ yvb "Oh come on housepoor! Your not that stupid."

All, please read the following quote from yvb and see if you can find the funny...

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Cooke 4 years, 4 months ago

YVB -- Sorry. Re-read my above post and replace "following" with "above".

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