Jones is seriously ill and has $5.30 million of property that he wants to leave to his four children. Jones is considering making a current gift of the property (rather than leaving the property to pass through a will). Assume all of his exemption equivalent was used and any taxable transfers will be subject to the highest transfer tax rate. (Refer to Exhibit 25-1 and Exhibit 25-2.) -1. Determine how much gift tax Jones will owe if the transfers are made now. -2. If Jones makes a current gift, how much estate tax will be saved if Jones dies after three years, during which time the roperty appreciates to $5.65 million? Hote: For all requirements, enter your answers in dollars and not in millions of dollars. a-1. Amount of gift tax a-2. Amount of estate tax savings
Jones is seriously ill and has $5.30 million of property that he wants to leave to his four children. Jones is considering making a current gift of the property (rather than leaving the property to pass through a will). Assume all of his exemption equivalent was used and any taxable transfers will be subject to the highest transfer tax rate. (Refer to Exhibit 25-1 and Exhibit 25-2.) -1. Determine how much gift tax Jones will owe if the transfers are made now. -2. If Jones makes a current gift, how much estate tax will be saved if Jones dies after three years, during which time the roperty appreciates to $5.65 million? Hote: For all requirements, enter your answers in dollars and not in millions of dollars. a-1. Amount of gift tax a-2. Amount of estate tax savings
Chapter27: The Federal Gift And Estate Taxes
Section: Chapter Questions
Problem 3DQ
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Transcribed Image Text:Jones is seriously ill and has $5.30 million of property that he wants to leave to his four children. Jones is considering
making a current gift of the property (rather than leaving the property to pass through a will). Assume all of his exemption
equivalent was used and any taxable transfers will be subject to the highest transfer tax rate. (Refer to Exhibit 25-1 and
Exhibit 25-2.)
a-1. Determine how much gift tax Jones will owe if the transfers are made now.
a-2. If Jones makes a current gift, how much estate tax will be saved if Jones dies after three years, during which time the
property appreciates to $5.65 million?
Note: For all requirements, enter your answers in dollars and not in millions of dollars.
a-1. Amount of gift tax
a-2. Amount of estate tax savings
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