TY  - JOUR
AU  - Kopczuk,Wojciech
TI  - Bequest and Tax Planning: Evidence From Estate Tax Returns
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 12701
PY  - 2006
Y2  - November 2006
UR  - http://www.nber.org/papers/w12701
L1  - http://www.nber.org/papers/w12701.pdf
N1  - Author contact info:
Wojciech Kopczuk
Columbia University
420 West 118th Street, Rm. 1022 IAB
MC 3323
New York, NY  10027
Tel: 212/854-2519
Fax: 212/864-8059
E-Mail: wk2110@columbia.edu
AB  - I study bequest and wealth accumulation behavior of the wealthy (subject to the estate tax) shortly before death. The onset of a terminal illness leads to a very significant reduction in the value of estates reported on tax returns - 15 to 20% with illness lasting "months to years" and about 5 to 10% in case of illness reported as lasting "days to weeks".  I provide evidence suggesting that these findings cannot be explained by real shocks to net worth such as due to medical expenses or lost income, but instead reflect "deathbed" estate planning.  The results suggest that wealthy individuals actively care about disposition of their estates, but that this preference is dominated by the desire to hold on to their wealth while alive.
ER  -