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Estate Taxes and Charitable Bequests: Evidence from Two Tax Regimes

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  • David Joulfaian

    (Government of the United States, Department of the Treasury)

Abstract

Much of the literature on the effects of estate taxation on charitable bequests has relied on cross sectional data, reflecting the uniqueness of death. Few have explored longitudinal data to exploit exogenous variations in tax regimes. The latter, however, continue to be susceptible to omitted variable as well as measurement error biases attributable to changes in the treatment of spousal bequests and frequent changes in tax regimes. This paper explores the effects of the estate tax on charitable bequests using administrative data from two tax regimes where earlier biases are minimized. The deductibility of charitable bequests is found to have significant implications for giving. However, the effects of estate tax repeal are much smaller. These findings are sensitive to expectations of the tax regime in effect at time of death.

Suggested Citation

  • David Joulfaian, 2005. "Estate Taxes and Charitable Bequests: Evidence from Two Tax Regimes," Public Economics 0505004, EconWPA.
  • Handle: RePEc:wpa:wuwppe:0505004
    Note: Type of Document - pdf; pages: 32. pdf document, 32 pages, uses US estate (inheritance) tax data over two period.
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    File URL: https://econwpa.ub.uni-muenchen.de/econ-wp/pe/papers/0505/0505004.pdf
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    References listed on IDEAS

    as
    1. Joulfaian, David, 2005. "Choosing between gifts and bequests: How taxes affect the timing of wealth transfers," Journal of Public Economics, Elsevier, vol. 89(11-12), pages 2069-2091, December.
    2. Auten, Gerald & Joulfaian, David, 1996. "Charitable contributions and intergenerational transfers," Journal of Public Economics, Elsevier, vol. 59(1), pages 55-68, January.
    3. B. Douglas Bernheim, 1987. "Does the Estate Tax Raise Revenue?," NBER Chapters,in: Tax Policy and the Economy, Volume 1, pages 113-138 National Bureau of Economic Research, Inc.
    4. Joulfaian, David, 2000. "Estate Taxes and Charitable Bequests by the Wealthy," National Tax Journal, National Tax Association;National Tax Journal, vol. 53(3), pages 743-764, September.
    5. Joulfaian, David, 1991. "Charitable Bequests and Estate Taxes," National Tax Journal, National Tax Association, vol. 44(2), pages 169-80, June.
    6. Boskin, Michael J., 1976. "Estate taxation and charitable bequests," Journal of Public Economics, Elsevier, vol. 5(1-2), pages 27-56.
    7. Randolph, William C, 1995. "Dynamic Income, Progressive Taxes, and the Timing of Charitable Contributions," Journal of Political Economy, University of Chicago Press, vol. 103(4), pages 709-738, August.
    8. Joulfaian, David, 2000. "Taxing Wealth Transfers and Its Behavioral Consequences," National Tax Journal, National Tax Association, vol. 53(n. 4), pages 933-58, December.
    9. Joulfaian, David, 1991. "Charitable Bequests and Estate Taxes," National Tax Journal, National Tax Association;National Tax Journal, vol. 44(2), pages 169-180, June.
    10. Joulfaian, David, 2000. "Taxing Wealth Transfers and Its Behavioral Consequences," National Tax Journal, National Tax Association;National Tax Journal, vol. 53(4), pages 933-958, December.
    11. Clotfelter, Charles T., 1985. "Federal Tax Policy and Charitable Giving," National Bureau of Economic Research Books, University of Chicago Press, edition 1, number 9780226110486, June.
    12. Robert McClelland, 2004. "Charitable Bequests and the Repeal of the Estate Tax: Technical Paper 2004-08," Working Papers 15799, Congressional Budget Office.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    Bequests; Taxes; Charitable Giving;

    JEL classification:

    • D19 - Microeconomics - - Household Behavior - - - Other
    • H24 - Public Economics - - Taxation, Subsidies, and Revenue - - - Personal Income and Other Nonbusiness Taxes and Subsidies
    • H31 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Household

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