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CH 10: Gifting Strategies
Terms in this set (23)
A credit applied to offset the estate tax due on an estate. The credit has been "unified" for gift and estate tax purposes, so it is now called the unified credit. But prior to that the credit was referred to as the applicable credit.
A sale of property to family members, charities, and others for less than fair market value. This transaction is part sale and part gift.
The value of property used to determine gain or loss for income tax purposes when the property is sold or for gift tax purposes when the property is transferred.
An irrevocable transfer of property.
Increasing by successive additions. Gift and estate taxes are cumulative in nature. Taxable gifts made since 1932 must be added to current taxable gifts before the gift tax is applied. Adjusted taxable gifts made by a decedent since 1976 are added to the taxable estate to determine the tentative tax base before the estate tax is applied.
A gift of real or personal property made outright to others.
A person or entity that is the recipient of a gift.
A person who transfers their own property to another person or entity.
The amount of a gift or bequest that escapes taxation. For 2015, the exemption equivalent amount is $5,430,000 and the tax on this amount is offset by a person's unified credit. The term is also referred to as an applicable exclusion amount.
A gift made to someone who cannot take immediate possession of a property or who must wait to receive beneficial use, enjoyment, or income from it.
A voluntary transfer without full or adequate consideration.
Gift Causa Mortis
A revocable gift made in anticipation of the donor's death that becomes a completed, irrevocable gift at the donor's death.
A transfer tax imposed when a donor gifts property that is subject to the tax.
A gift that is not a complete transfer of property. An incomplete gift is not subject to gift tax.
A gift that is not made outright to a donee but benefits the donee. An indirect gift is subject to the gift tax.
A gift made during the donor's lifetime.
A gift giving the donee the unrestricted right to the immediate use or enjoyment of or income from a property.
Increasing in rate as the base increases. Gift and estate taxes are progressive in nature. The unified transfer tax rates for gifts and estates range from 18% to 35% in 2012.
A donor gifts property in anticipation of a donee's death to receive a step-up in basis when the same property is bequeathed to the donor (at the donee's subsequent death).
Assets owned by a decedent receive a new federal income tax basis equal to the property's fair market value for federal estate tax purposes.
When the tax paid on a gift is paid from the donor's separate funds, and does not reduce the value of the gift the donee receives.
When estate tax liability is paid with money that was taxed in the decedent's estate. In some situations, GST taxes are paid from distributions made to a skip person beneficiary, which reduces the amount the skip person receives.
The credit available to offset gift or estate taxes. This credit is 2,117,800 in 2015. Formerly referred to as the applicable credit.
Sets found in the same folder
CH 1: Introduction to Estate Planning
CH 2: Property Interests
CH 3: Community Property
CH 4: Methods of Property Transfer at Death
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