Those favoring collection of death taxes cavalierly dismiss it as only affecting a small number of very wealthy Virginians. But the "very wealthy" typically can afford high-priced lawyers and accountants to help find legal ways to avoid the tax, or they can - and will -- change domicile to any of the 30+ states that will have no death tax. Those hurt by the death tax are small business men and women, family farmers, and those they employ. Here are what a few women business owners have to say about the real-world impact of the death tax:

Small Businesses Oppose the Death Tax

"The prospect of death tax repeal in Virginia is exciting because repeal of the death tax will mean small business will be able to reinvest back into their business and their own community."

Gordon Dixon
State Director
National Federation of Independent Businesses / Virginia
October 22, 2003

Truckers Oppose the Death Tax

"My business was started with an idea, hard work and determination to succeed, and I want to pass on the results of my hard work to my children. Why should my two daughters at the time of my death, be faced with possible liquidation of company assets or worse, an outright sale of our family business just to pay such a cruel and unfair tax?"

John Cox, President
Cox Transportation Systems
January 15, 2003

Child Care Providers Oppose the Death Tax

"We are a tax-paying entity that employs more than 100 Virginians and serves more than 900 children every day. It is unfair that this business, founded by my mother and run now by my siblings and I, should have to liquidate and lay off employees in order to pay this unfair tax."
Vernon Holloman
Holloman Child and Education Centers
January 15, 2003

Mom & Pop Businesses Go Under

"Susan Brassell represents nearly 80 tow truck companies as executive director of the Virginia Association of Towing and Recovery Operators…. 'Most of the money that they earn is put back into the company as equipment,' she said. One truck can cost as much as $50,000. Heavy-duty equipment can run more than $800,000. Those assets alone can push business owners over the $1 million cap, she said. And when the owner dies, often the only option is to sell the business to pay the estate tax."

VETO SETS UP SHOWDOWN ON ESTATE TAX BILL
by Kevin Crossett, Lynchburg News & Advance, March 27, 2003

Full Repeal Reality

The greatest part of America's wealth lies with family-owned businesses.

• According to the Virginia Family Business Forum at VCU, over 80 percent of all business enterprises in North America are family-owned.
  
  
• While 81 percent of senior generation family business shareholders want the business to stay in the family, twenty-five percent have not completed any estate planning other than writing a will.
  
  
• Nearly 70 percent of family businesses fail before reaching the second generation; 88 percent fail before the third generation.
  
  
• Family businesses account for 78 percent of all new job creation, 60 percent of the nation's employment and fifty percent of the Gross Domestic Product.

Family businesses are all unique.

Family businesses are unique:

• different in the size of their organizations,
  
  
• different in the way in which they must raise or invest capital to expand their businesses,
  
  
• different in the role that the family members play in the organization, and
  
  
• Some family businesses are multi-generational and they not only own the stock of the company but also participate in its management.
  
  
• Some require investment that is gained in the public market; why should that disqualify them from being a family business.
  
  
• A family business should be the assets of a family that they have worked hard and took risks to attain, on which they have already paid taxes. It should not be limited by size or capital structure.
  
  
• It is impossible to define a family business without discriminating against many family businesses, which is why exemption provisions, passed by Congress are being repealed. It is unworkable because it is too hard to define a family business without eliminating most of the family businesses in America.
  
  
• The state government has reported that the legislation that allegedly exempts some farms and business from the death tax will have "minimal" effect and not enough to consider in the budget.

Cost of Planning for Small Business Owners

• Part of the onerous cost of the death tax is planning. Family owned businesses and farms buy expensive insurance policies and under go extensive and expensive planning with estate and trust lawyers, tax attorneys and family planners. For a successful, middle-aged couple planning for the future, what should they say to their high-priced experts? That they will certainly qualify and therefore should not do any planning? After all, they aren't wealthy. But what if their business thrives and succeeds beyond their wildest imagination. Then, without having gone through the expensive planning with high priced experts, they will leave their heirs in a difficult position that this bill is intended to remove -- being forced to lay-off employees, sell off assets and possibly liquidate the estate.
  
  
• The Associated Equipment Distributors found that their member companies spend over $16 million a year to fund death tax plans and an additionally have spent over $30 million on lawyers and accountants and other consultants to set up estate plans.
  
  
• The National Association of Women Business Owners found that women business owners across the country spent $60,000 over the past five years on estate tax planning instead of investing that money in jobs.
  
  
• NAWBO also found that 40 percent of women business owners anticipate needing to sell all or part of their company after their death to pay the taxes.
  
  
• NAWBO further found that as many as new 100 jobs would be lost over the next five years for each of their member companies because of money spent to avoid the death tax.
  

Learn more about how the Death Tax Impacts...

Minority Business Owners | Women Business Owners | Family Farmers | Economic Growth and Jobs