Debate on estate taxes rolls on

Regarding "The taxing concept of estate taxes" [Letters, Dec. 23], if all estates consisted of savings accounts from earnings previously taxed, it would be appropriate to characterize the current estate taxes as taxing income twice. Except that is not usually the case.

Most of the time the biggest portion of the estate consists of real estate or stocks that were purchased many years ago and which have appreciated 10-fold or more and would have been subject to capital gains tax if sold by the owner during his or her lifetime.

What opponents of the estate tax always fail to mention is the fact that there is no estate or gift tax on transfers between husband and wife either during their lifetime or by a will at the time of death.

Starting this year, there will be a $5 million exemption from federal estate tax for everyone else who does not qualify for the marital deduction. However, New York State has its own estate tax and the nonmarital deduction for residents is still $1 million.

Haig Chekenian

Smithtown

Editor's note: The writer is an estate lawyer.

As to estate taxes being a second tax on the same funds, not all funds in one's estate have had income tax paid on them. There are many sources of nontaxable income - municipal bonds, etc. Since estate taxes are only paid if one has a certain minimum-size estate, assets may have been passed along in the past to the decedent without previously being subject to estate taxes.

In addition, some assets are passed along by gift, and gifts may be made without gift tax up to a certain amount per year per recipient which over one's lifetime can add up to a substantial amount, passed untaxed to the recipient. Remember estate tax is on the value of assets, not income, and any increase in the value of the assets may also not have been taxed.

By using the logic of the writers, if I earn income and pay tax on it and then pay someone for services rendered, that person should have no income tax on the money as I have paid already done so. Each transaction must be separate in its consideration for the assorted taxes we pay.

Meryl Ambrose

North Merrick