The Karl DeLong Estate (with a taxable value of more than $16,500,000) includes the following assets: 200 shares of common stock in the DeLong family corporation (valued at $3,580,000) 1,000 shares of common stock in a large public utility that trades more than 100,000 shares per day (valued at $1,560,000) Certificates of deposit (valued at $520,000) Three commercial buildings located in an older part of town where values are decreasing rapidly (valued at $4,525,000) Which valuation technique could best be used to reduce the value of Karl's gross estate? A)The alternate valuation date for all assets B)A blockage discount on the public utility stock C)Special use valuation on the CDs D)A fractional interest (co-ownership) discount on the DeLong family stock

The Karl DeLong Estate (with a taxable value of more than $16,500,000) includes the following assets: 200 shares of common stock in the DeLong family corporation (valued at $3,580,000) 1,000 shares of common stock in a large public utility that trades more than 100,000 shares per day (valued at $1,560,000) Certificates of deposit (valued at $520,000) Three commercial buildings located in an older part of town where values are decreasing rapidly (valued at $4,525,000) Which valuation technique could best be used to reduce the value of Karl's gross estate? A)The alternate valuation date for all assets B)A blockage discount on the public utility stock C)Special use valuation on the CDs D)A fractional interest (co-ownership) discount on the DeLong family stock

SWFT Comprehensive Volume 2019

42nd Edition

ISBN:9780357233306

Author:Maloney

Publisher:Maloney

Chapter3: Computing The Tax

Section: Chapter Questions

Problem 42P

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1. David Collins died during the current year. The personal representative of David's estate reviewed the following assets: Stocks in David's name only: 2,000,000 Investment property in a trust that David has the right to revoke: 1,500,000 Primary home owned jointly with his wife (wife did not contribute to the purchase): 1,000,000 Insurance policy owned / insuring David with the proceeds payable to his daughter: 800,000 Vacation home owned jointly with his son (son did not contribute to the purchase): 500,000 Cash placed in an irrevocable trust by David 8 years ago with David's friend as trustee: 600,000 What is the value of David's gross estate for estate tax purposes? $3,500,000 b. $4,250,000 а. c. $5,300,000 d. $6,400,000
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Jennifer Thompson is the grantor of the Jennifer Thompson Trust, a revocable grantor trust. Ten years ago, Jennifer acquired a piece of real estate for $200,000. A year later, she spent $14,000 in improvements on the property. This year, when the value of the property was $300,000, she transferred it to the trust. What is the trust's basis in the property? A. $200,000 B. $214,000 C. $300,000 D. $314,000
Mr. Jackson died on June 19 when the total FMV of his property was $24 million and his debts totaled $2.789 million. His executor paid $23,000 funeral expenses and $172,000 accounting and legal fees to settle the estate. Mr. Jackson bequeathed $500,000 to the First Lutheran Church of Milwaukee and $1 million to Western Wisconsin College. He bequeathed his art collection (FMV $6.4 million) to his wife and the residual of his estate to his three children. Assume the taxable year is 2023. Required: a. Compute Mr. Jackson's taxable estate. b. Compute the estate tax payable by Mr. Jackson's executor if Mr. Jackson made no taxable gifts during his lifetime. c. Compute the estate tax payable by Mr. Jackson's executor if Mr. Jackson made a substantial taxable gift in 2011 and used $5 million of his lifetime transfer tax exclusion to reduce the amount on which gift tax was owed to zero. Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs…
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As to Principal I charge myself with: Assets subsequently discovered: Total charges I redit myself with: Estate principal Estate principal: Estate principal As to Income I charge myself with: I credit myself with: Balance as to income Balance as to income:
The executor of Rose Shield's estate listed the following properties (at fair value): $ 350,000 250,000 150,000 Cash Life insurance receivable Investments in stocks and bonds Rental property 100,000 180,000 Personal property Following are the transactions that occur in the months following the decedent's death: 1. Claims of $90,000 are made against the estate for various debts incurred before the decedent's death. 2. Interest of $22,000 is received from bonds held by the estate. Of this amount, $4,000 had been earned prior to death. 3. Ordinary repairs costing $11,000 are made to the rental property. 4. All debts ($90,000) are paid. 5. Stocks recorded in the estate at $21,000 are sold for $29,000 cash. 6. Rental income of $24,000 is collected. Of this amount, $7,000 had been earned prior to the decedent's death. 7. Cash of $7,000 is distributed to Jim Arness, an income beneficiary. 8. The proceeds from the life insurance policy are collected and the money is immediately distributed to…
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