No Taxes on Family Gifts

Common Sense for Oregon

Picture this scenario: the year is 2017. Oregon’s economy has rebounded nicely from the Great Recession. More people are moving into the state, and more people – including business owners, farmers and families – are staying in the state. The unemployment rate is the lowest since the Great Depression. More money is entering the state’s coffers than ever before, as the new residents increase the money the state receives from income and property taxes.

This scenario would have been real today had the estate tax been abolished in Oregon in 2012 (the first time we approached the state with the idea). But this 2017 scenario is still a dream. Now the year is 2015, and there is good news: we still have time to move Oregon’s economy in a positive direction to make the 2017 dream become reality.

Oregon needs to start rewarding its residents – the ranchers, the farmers, the small business owners, the families – who already contribute money to the state in property and income taxes, among many other taxes, by stopping the double and triple taxation of the Oregon estate tax. We need to make sure no tax is imposed on any gift of property within a family.

It is generally agreed upon that Oregon’s economy was struck with a death blow by the Great Recession. And while the economy has been improving – ever so slightly – it is still not cured by the Great Recession. We believe the state continues to add another “death” blow to the Oregon economy by continuing the estate tax, also referred to as the “death” tax.

The estate tax is a tax imposed on your estate when you die. An estate includes cash, stocks, property, jewelry, etc. This is what is passed on to your spouse and family members. It is based on the value of the estate. You can think of it as a type of property tax that is imposed on your property when you die. Usually, there is a deduction level and the government imposes a tax on the value above the deduction. In Oregon, if all the property you leave at death $1 million or less your family does not have to pay a tax. But if the value of your estate is over $1 million your estate is going to have to pay a tax ranging from 10% to 16%.

Oregon’s total estate tax revenue in 2012 was $101.8 million which represented just 1.2% of the total state tax revenue. Economists projected that increased income taxes from new jobs created by eliminating the estate tax would offset the loss of estate taxes within five years. If the estate tax was eliminated in 2013, “44,500 new jobs would have been created. The personal income of state residents would be $2.4 billion higher.  The state income tax collection would exceed the average death taxes revenues.” (Fruits, Eric & Pozdena, Randall. Oregon’s Death Tax: An Impediment to Economic Growth, In-Migration, and Public Revenue). Today, the numbers remain relatively the same.

When new entrepreneurs see a tax-friendly state, they will be more willing to come to Oregon and create jobs. And economists still project that taxes imposed from the new jobs will more than make up the tax.

Many ranchers, farmers and family business owners find the value of their land, buildings, equipment and their own homes substantially exceed $1 million. So while the ranchers and farmers may be land rich, they are cash poor. These families are confronted to pay an Oregon estate tax every time a generation passes away.

We want to help all Oregonians – husbands, wives, domestic partners, great grandparents, grandparents, parents, children, grandchildren, great grandchildren, great uncles, great aunts, uncles, aunts, nephews, nieces, great nephews, great nieces, siblings, and cousins – to stay in our state. Each member of a family is important to our state and the health of our economy.  So if you are a family member, your support for our efforts is essential. We first need your signature to get our initiative on the ballot.

To sign our petition electronically please visit www.protectfamilygiving.org.

To help collect more signatures than your own, you can contact us by email at [email protected] or by phone at 503-480-0523.

You can also help fund our tax reform efforts.

To donate online, visit www.commonsensefororegon.org/give.

To donate by check, make checks payable to:

Common Sense for Oregon, Inc.
2007 State Street
Salem, Oregon 97301

All contributions are confidential and can be made personally or by businesses without limit.

Oregon does not need any more businesses closing up shop, jobs lost, or families hurting. Our state has suffered financially for far too long. Many states are finding new ways to keep businesses from leaving, including 35 states who have eliminated the estate tax. It’s time to make the scenario pictured above a reality here in Oregon.