Tuesday, February 27, 2007

Just a Reminder

It's not really yours. And, at least according to the tax man, it isn't God's either.

Most of us believe in private property rights. As Americans, and even nominal Christians, we think that such rights are ordained and established by God. Our representative government has a different view. That entity also employs men with badges and weapons to enforce that view.

I'm not talking now about property taxes. Everyone is familiar with that aspect of state ownership of our "property". Nor am I even talking about the "use tax" that many states employ (including my home state) for the "use and enjoyment within the boundaries of the state" of personal property.

No, right now I'm simply talking about everything you own.

The Internal Revenue Code contains numerous provisions for taxing transfers of property. If it is done after you die, it is the estate tax. If you make the transfer during your life, it is subject to a gift tax. Happily, for us peons,* Congress has made exemptions. It has graciously allowed us to give up to $12,000 per person to anyone each year without having to pay tax. (There are other exemptions too.) If an exemption doesn't apply to you, the government claims up to 40%. Actually, if you are moderately wealthy and make a few bad choices, you could be liable for 113% of the gift in certain scenarios.

The important thing is the presumption: you owe the tax unless Congress has granted a special exemption.

One of the classic elements of the right to private property was the power to dispose of it as you wished. But, for a long time, Congress has not recognized such a right. Instead, it considers such a transfer to be a privilege subject to its discretion:

"Like provisions in earlier acts have been generally upheld as imposing a tax on the privilege of transferring the property of a decedent at death. . . ." Chase Nat'l Bank v. US, 278 US 327, 334 (1929).

We can pray that Congress will continue to be merciful. As it is now, we have no real claim of right. Short of a political revolution (or other kind), it is not likely to change.

In the meantime, the sovereign reserves its right to follow history:

And now whereas my father did lade you with a heavy yoke, I will add to your yoke: my father hath chastised you with whips, but I will chastise you with scorpions.

1 Kings 12:11

Nevertheless, the God with whom we have to do, our avenger and our judge, lays a greater claim: ". . . for the world is mine, and the fulness thereof." Psalm 50:12. As we pay obeisance to the rulers of this world, we can still pray and protest, invoking Psalm 2:

Be wise now therefore, O ye kings: be instructed, ye judges of the earth.
Serve the LORD with fear, and rejoice with trembling.
Kiss the Son, lest he be angry, and ye perish from the way, when his wrath is kindled but a little. Blessed are all they that put their trust in him.

*Peon (noun)
. . . a person held in compulsory servitude to a master for the working out of an indebtedness

Merriam-Webster Online Dictionary


lauren said...

I have to admit the Crits have a point. One badly misspoken fragment of a judicial ruling, such as "privilege of transferring" can alter reality. Who knows what that judge had for breakfast?

Ruben said...

Oh kindly State, allowing us the illusion that what we seem to possess is ours (until we are ready to do something with it).