The estate tax and the demise of the family business

• 成果类型: Article
• 署名作者: Brunetti, Michael J.
• 刊物名称: JOURNAL OF PUBLIC ECONOMICS
• ISSN/ISSBN: 0047-2727
• DOI: 10.1016/j.jpubeco.2006.05.012
• 发表日期: 2006
• 页码: 1975-1993
• 关键词: estate tax; family business

摘要

This paper uses data from San Francisco probate records to estimate if, and to what extent, the estate tax forces the sale of family businesses and farms; this question cannot be addressed with estate tax return data. Farmers and small business owners frequently complain that the estate tax makes it difficult to pass their operations on to their heirs. If there are insufficient liquid assets in the entrepreneur's estate, the heirs may be forced to sell the enterprise in order to pay the estate tax. Using variation in tax liability from state and federal tax changes in 1982, 1 estimate the effect of the estate tax on business sales. Estimates from models using cross-year tax variation and a difference-in-difference strategy,provide some evidence for a positive effect of the estate tax on sales, although it is difficult to link this to explicit measures of liquidity need. (c) 2006 Elsevier B.V. All rights reserved.