You gotta hand it to them…the Center of the American Experiment just continues to do amazing work.  Please, if you haven’t already done so, contact the Center for a print copy of Peter Nelson’s Minnesotans on the Move to Lower Tax States 2016.  This 20 page monograph, IRS data-based shows you how Minnesota is losing taxpayers in the age 35 and up range.

Sure, we’re losing some seniors but now we know what’s happening to those in the prime working ages.  The seniors take tremendous wealth with them (see page 13 in Peter’s work cited above) that could have been spent and taxed here but now thanks to the IRS age-based data we feel the economic pain of the prime working age taxpayers leaving Dodge.  The wrong stage is set by unconscionable Minnesota taxation.  Let’s move back to those approaching retirement.

We have pointed out before that Minnesota’s crazy estate/gift tax claw-back creates havoc in trying to plan for estate settlement.  You need to leave this state three years before you die.  If you’re not sure when you might die, you have to look seriously at leaving sooner.  Couple that with the 2013 Edina tax (9.85%) for those with higher incomes, the ordinary tax rate on capital gains, throw in taxing Social Security benefits and endless legislative threat of over-taxed surpluses that cause greater forward spending and even higher taxes to pay for accelerating spending, and you have a formula for disaster. 

It is time to eliminate the Minnesota estate tax and help keep taxpayers who have managed to accumulate some money to remain in Minnesota where we can collect state income and sales taxes from them, bolster our economy and the jobs picture and make a better life possible for everybody here.

There is no doubt in our thinking that the Minnesota estate tax is a negative tax in toto.  We are losing more income and sales taxes by driving out the wealthier taxpayers than we ever collect in estate taxes.  The estate tax is really just a political tax, not a genuine tax.  It’s great politics boasting about how we’re making those rich s.o.b.’s pay.  It doesn’t matter that we generate less total tax revenue as a consequence.

There are a number of other related aspects that we can’t get into here such as residency rules, the effects on our medical community, businesses and jobs, jobs, jobs so let us end with a simple plea that the abolishment of the Minnesota estate tax is long overdue.  Please read Peter’s monograph and his article below Time to Eliminate Minnesota’s Estate Tax.  Here is the link for the updated document.  Click here.  Thank you.

Bob Smith 3^rd