If you're rich enough, however, you can hire professionals who can, for a price, show you how to avoid estate taxes. Many of the very largest estates are so tax-sheltered that the inheritances go to their beneficiaries having paid little or no taxes at all. And all the costs associated with these tax shelters and tax avoidance schemes are pure wastes for the country as a whole and exist solely to circumvent the estate tax. The estate tax in and of itself causes people to waste resources.
Whoa, whoa, whoa. Hold on there, friend. Hiring me to help you save taxes is hardly a waste of resources. It's an investment. And like all monetary transactions, what moves from one party's pocket to another party's pocket - commerce - what may be lost by the one party is a gain for the other. In exchange for the fee I charge, you get a quality work product. I take your fee (Thanks!), pay my staff, my overhead, myself, and then pump that money right back into the economy.
How exactly is that a waste of resources?
This is an argument that's often trotted out when the idea of simplifying taxes is batted about; it costs taxpayer's money to comply with the tax law and that makes the tax law that much more inefficient. Those who make that argument fail to acknowledge my point that money spent on tax compliance is, in turn, spent on groceries, rent, clothing, transportation. In short, money's never lost.
So, let's show some love for your CPA, okay?
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