student 27 - 1.Among the assets included in Taylors gross...

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1.Among the assets included in Taylor’s gross estate are the following. Fair Market Value Date of Death Six Months After Date of Death Stock in Grebe Corporation Stock in Rail Corporation Office building $4,000,000 800,000 900,000 $3,800,000 850,000 900,000 Three months after Taylor’s death, her executor sells the Rail stock for $840,000. a. What is the amount of Taylor’s gross estate if date of death value is used? b. What is the amount of Taylor’s gross estate if the alternate valuation date is elected? c. Suppose the accrued rents on the office building are as follows: $80,000 (date of death) and $75,000 (six months after death). How does this change the answers in parts a. and b.? d. Suppose all of Taylor’s assets pass to her surviving spouse. Does this have any impact on the choice of valuation date? Explain. NS: a. $5,700,000 . $4,000,000 + $800,000 + $900,000 = $5,700,000. b. $5,540,000 . $3,800,000 + $840,000 + $900,000 = $5,540,000. c. Regardless of whether § 2032 is elected, post-death income earned on estate assets is not taken into account. Thus, the income earned up to date of death is the amount included in the gross estate. The answer to part a. is $5,780,000 and part b. is $5,620,000. d. Yes. Because of the marital deduction, the estate tax would be zero whether § 2032 is elected. One of the conditions for electing the alternate valuation date is that it reduces the estate tax
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This note was uploaded on 11/04/2010 for the course ACCOUNTING Act 3392 taught by Professor Dr.burks during the Spring '10 term at Troy.

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student 27 - 1.Among the assets included in Taylors gross...

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