Comments on: Warren Buffett and Bill Gates on the estate tax

By: Warren Buffett a hypocrite and futures traders should pay even lower taxes. | traderhabits.com

Wed, 13 Jul 2011 13:24:20 +0000

[...] http://www.trustsestateslaw.com/2009/05/warren-buffett-and-bill-gates-on-the-estate-tax/ [...]

By: Moe

Moe — Wed, 08 Jun 2011 16:43:12 +0000

I agree with Zelinsky and some of the other comments. Taxes to the government are totally different from charities. Say for example you disagree with some government policies that doesn’t mean you can give x percent of your income to a charity of your choice.

By: twitter

twitter — Mon, 18 Apr 2011 05:51:14 +0000

Thanks for the interesting article but you are too kind to Mr. Gates and Buffet’s intentions with their charity. Gates Foundation spending has a tendency to do good things for Gates’ and Buffett’s other investments. Mr. Gates may have a real interest in education but his charter school promotions seem more about making sure Microsoft gets a cut of state budgets than it does in following any accepted scientific teaching methods and teacher unions are hopping mad about it. Gates also has big investments in big agra and energy that the foundation routinely boosts against the advice of science. Despite promises, the Gates Foundation does not allow proper audits of spending. The guy who set up Microsoft’s tax dodges knows how to protect his personal and family wealth.

Don’t judge people by what they say, judge them by what they do.

By: Saul Elnadav

Saul Elnadav — Fri, 21 May 2010 13:01:33 +0000

Bruce — all I’m pointing out is that that kind of tax planning, regardless of motivation, is inconsistent with Buffett and Gates’ public statements in support of the estate tax. Sure, philanthropy is about supporting causes you’re passionate about — in fact, that’s half the point. The U.S. government isn’t quite as passionate about R&D in the developing world, and yet rather than fulfill their moral obligation by supporting the society and democratic principles (including decisions as to the allocation of public funds) that made their wealth possible, they’ve privately chosen to support causes they consider more important. I don’t necessarily disagree with the decision — hey, I help clients with tax planning — but it is inconsistent with their statements.

By: Bruce

Bruce — Wed, 19 May 2010 14:43:49 +0000

Your logic doesn’t necessarily follow. Just because Bill and Warren donate their fortune to charity does NOT mean that they do so to avoid paying taxes. It’s possible, but you have no proof of that. I would argue that donating your wealth to charity has much more to do with supporting causes that you’re passionate about – whether or not you think that they’re the responsibility of good government. For example, the Gates Foundation invests heavily in R&D for the developing world, not something that is traditionally the domain of the US gov.

By: Saul Elnadav

Saul Elnadav — Mon, 18 May 2009 20:29:00 +0000

Avrohom: I think you are construing the idea of a moral debt to society a little narrowly, as though it were a debt specifically to the U.S. government. Zelinsky would like to see at least some of the money intended for the public good go through the Treasury rather than charitable organizations. He places a lot of importance on the fact that “the federal Treasury is controlled by the people of the United States through their elected representatives,” while “the Bill and Melinda Gates Foundation is controlled by Bill and Melinda Gates.”

On the other hand, it is perfectly natural, and I think appropriate, for someone who is giving his entire wealth back to society to plan for what he believes will make the biggest positive impact on society. And as long as it’s legal to do so, why should his philanthropy take a back seat to what the people through their elected representatives deem the best use of his money? Just to make the point that the estate tax is morally defensible?

By: rod

rod — Mon, 18 May 2009 19:35:00 +0000

To me, these two individuals carry little credibility on this issue. It is one thing to have billions of dollars, which after taxes will leave enough wealth to sustain many generations. It’s entirely different to work your entire life, own a business, farm or just have 1 million dollars in wealth and have the government 50% of what your family could have to live on. It’s simply not right for the “state” to have claim to that much of one’s hard earned wealth.

By: Avrohom Gefen

Avrohom Gefen — Mon, 18 May 2009 19:04:00 +0000

“If Buffett really believes that the best place for his money was the federal government, he should donate it all to the Treasury and encourage Bill Gates to do the same.” I think you miss Zelinsky’s point. From Buffet’s viewpoint, Buffet doesn’t need to believe that the federal govt. is the best place for his money to logically fund his foundation with after-tax money. Rather, if Buffet thinks that there is a debt owed to the U.S. for enabling the creation of his great wealth, then taxes should be paid, regardless of whether this is the absolute best use of the money.

By: Saul Elnadav

Saul Elnadav — Mon, 18 May 2009 18:17:00 +0000

Bigcitythinker:

I highly doubt that Bill Gates and Warren Buffett are donating their wealth to charity for the purpose of avoiding estate tax. As you say, this is clearly about supporting important causes. However, the question, as posed by Professor Zelinsky, is why they do so in a way that avoids the estate tax if they've also publicly supported the retention of the estate tax. Why not give to charity on a taxable basis?

I'll plead guilty to slippery-sloping Professor Zelinsky's suggestion that the Treasury get a significant share of the estates. I don't know Professor Zelinsky, but by urging Gates and Buffett to give charity on a taxable basis, he probably does not mean that the best use of wealth is to turn it all over to the government. But he does want to see Warren Buffett back up his support for the estate tax with actions.

My point, though, is that the moral obligation for the wealthy to give back to society, attributed to both Gates and Buffet, is consistent with the kind of philanthropy Gates and Buffett are engaged in. You don't have to wholeheartedly sign on to the U.S. government's spending policies to give back to society. In fact, it appears that by not giving charity on a taxable basis, Warren Buffett is saying that the Gates Foundation will do more good with his money that the U.S. government.

By: Bigcitythinker

Bigcitythinker — Mon, 18 May 2009 17:38:00 +0000

Your logic doesn't necessarily follow. Just because Bill and Warren donate their fortune to charity does NOT mean that they do so to avoid paying taxes. It's possible, but you have no proof of that. I would argue that donating your wealth to charity has much more to do with supporting causes that you're passionate about – whether or not you think that they're the responsibility of good government. For example, the Gates Foundation invests heavily in R&D for the developing world, not something that is traditionally the domain of the US gov.