The Income Equality Case for Eliminating the Estate Tax

56 Pages Posted: 30 Jan 2018

See all articles by David Herzig

David Herzig

Ernst & Young; Valparaiso University Law School

Date Written: January 30, 2018


The estate tax and income tax rules independently attempt to either promote or deter different behaviors. The interaction of these different rules often leads to disparate or unintended consequences to taxpayers: for example, achieving an overall lower effective tax rate by paying more estate tax to lower the income tax rate. This overlay of the estate tax rules on the income tax rules is a key problem at the core of our tax system. Yet, few scholars focus on this topic.

In this Article, I document the actual behavior of the trust and estate bar. By looking at how attorneys approach the intersection of estate and income taxes, I demonstrate deficiencies in the current scholarly belief, which is based largely on anecdotal information, that the wealthy have a preference for paying less or no estate tax. I show the real-world preferences that indicate wealthy taxpayers are paying high levels of estate tax to minimize the income tax incidents. After showing the shift of preferences and the resulting overall tax loss to the fisc, the Article then proposes useful policy solutions, such as elimination of the estate tax or using death as an income tax triggering event.

Keywords: tax, estate tax, 2038, 2036, estate planning, realization at death

Suggested Citation

Herzig, David, The Income Equality Case for Eliminating the Estate Tax (January 30, 2018). Southern California Law Review, Vol. 90, No. 1143, 2017; Valparaiso University Legal Studies Research Paper No. 18-1. Available at SSRN:

David Herzig (Contact Author)

Ernst & Young ( email )

710 Bausch and Lomb Pl
Rochester, NY 14604
United States

Valparaiso University Law School ( email )

656 S. Greenwich St.
Valparaiso, IN 46383-6493
United States
219-465-7809 (Phone)
219-465-7872 (Fax)


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