chapter 13 chapter The ite ax
1 Chapter 13: The Estate Tax
THE ESTATE TAX The estate tax formula Gross estate valuation Gross estate items Deductions Computation of tax liability Generation-skipping transfer tax
2 THE ESTATE TAX The estate tax formula Gross estate valuation Gross estate items Deductions Computation of tax liability Generation-skipping transfer tax
The Estate Tax Formula (1of3) Gross Estate Deductions(exp, debts, losses Adjusted Gross Estate Marital charitable deductions Taxable estate Prior taxable gifts Estate tax base 3
3 The Estate Tax Formula (1 of 3) Gross Estate - Deductions (exp, debts, & losses) = Adjusted Gross Estate - Marital & charitable deductions = Taxable estate + Prior Taxable Gifts = Estate tax base
The Estate Tax Formula (2of3) Taxable estate is gross estate minus deductions All taxable gifts made after 1976, other than gifts included in gross estate are added to taxable estate Gifts valued at date-of-gift values Sum of two amounts is tax base
4 The Estate Tax Formula (2 of 3) Taxable estate is gross estate minus deductions All taxable gifts made after 1976, other than gifts included in gross estate, are added to taxable estate Gifts valued at date-of-gift values Sum of two amounts is tax base
The Estate Tax Formula (3of3) Compute tentative tax on estate tax base Tentative tax Recomputed gift tax Available unified credit Other credits Estate tax due 5
5 The Estate Tax Formula (3 of 3) Compute tentative tax on estate tax base Tentative tax - Recomputed gift tax - Available unified credit - Other credits = Estate tax due