A legislative rush during times like these can have some odd things found in them.–Ed
The family of Daniel C. Lewin might consider themselves a little lucky this week.
That may seem pretty bizarre after Daniel got imbedded into a World Trade Center tower, but this is a pretty bizarre story.
Daniel C. Lewin was the chief technology officer of Akamai Technologies, a company that provides technology which makes Web sites work better.
During the tech spree, he was one of the transitory billionaires when Akamai was riding high. The stock has since plunged, but Mr. Lewin would still have been considered a wealthy man.
So how could smacking into a building at a couple hundred miles an hour possibly be a good thing? Think of the tax benefits.
You’re probably saying, “How can you think about taxes at this time??” Well, I wasn’t, but some Congressman sure did, and it’s going to mean some huge tax breaks for a handful of tech people like Mr. Lewin and some investment people working at WTC.
Look at H.R. 2884, the Victims of Terrorism Relief Act of 2001. This sailed through the House and Senate yesterday.
There have been some long-standing provisions in the American tax code that essentially give a “Get Out of Tax Free” card out to certain people getting killed by enemies of the United States under certain circumstances.
For income taxes, what is basically does is wipe out any federal taxes in the year that you died (along with any federal income tax you happened to owe in any previous years; it’s the only circumstance under which it pays not to pay your taxes).
An even more obscure provision applies to estate taxes. Estate taxes are taxes on wealth paid by the estates of wealthy people. What this provision essentially does is reduce the estate tax bill by roughly two-thirds.
These provisions were initially meant for soldiers getting killed in combat or dying as a result of this. I certainly think this is a good thing.
A little more than fifteen years ago, this was extended to Federal employees killed as a result of a terrorist action. Certainly not objecting to that, either.
What this bill does is extend those tax provisions to those killed in Tuesday’s actions. Again, for the vast majority of the victims, this is fitting and proper. They’ll end up getting hundreds or thousands in previously paid taxes back, and this will certainly help the families of the deceased.
However, for the first time ever, there’s going to be a decent-enough number of people who are going to end up with huge tax breaks as a result of this, both people like Mr. Lewin, and those executives, for both technical firms and financial institutions.
We’re not talking about people getting back hundreds or thousands or a couple tens of thousands of dollars in taxes paid. In at least a few cases, we’re talking millions or more.
Now whether or not that’s a good idea is at least debatable. I’m not even sure about it myself.
What I think would be a good idea is not to rush this through without thinking, and think about it for those on the high-end a bit. It would be easy enough to add a few words to the law limiting the benefit to, say, $250,000. That certainly would have no effect on the vast, vast majority of those who died, but wouldn’t give the store away to the relative handful of very wealthy victims without at least a little thought about it.
If Congress later decides it’s a good idea after all, they can always change the law to remove that limitation.
Sometimes, hastiness isn’t good, and in the emotional rush, those not so emotional can slip things through they’d never get if people (or Congressmen) were paying due attention.
If you have an opinion on this, pro or con, you might want to contact your Congressman about this.