Question

(The following information applies to the questions displayed below.) Tom Hruise was an entertainment executive who had a fatal accident on a film set. Tom's will directed his executor to distribute his cash and stock to his wife, Kaffie, and the real estate to his church, The First Church of Methodology. The remainder of his assets were to be placed in trust for his three children. Tom's estate consisted of the following: Assets: Personal assets Cash and stock Intangible assets (film rights) Real estate $ 1,130,000 25,300.000 78,000,000 16,300,000 $ 120,730,000 Liabilities: Mortgage Other liabilities $ 4,500,000 5, 400,000 9.900.000 S a. Tom made a taxable gift of $6.40 million in 2011. Compute the estate tax for Tom's estate. (Refer to Exhibit 25-1 and Exhibit 25-2.) (Enter your answers in dollars, not millions of dollars.) Gross estate Debts Adjustable gross estate Marital deduction Charitable deduction Taxable estate Adjusted taxable gifts Cumulative taxable transfers Current tax rates Tax on cumulative transfers Gift taxes payable on adjusted taxable gifts at current rate Tentative estate tax Applicable credit Gross estate tax

Please show work!!

Answer 1

a.Gross Estate	120,730,000
b. Maritial Deduction	25,300,000
c. Charitable deduction	16,300,000
d. Debts	9,900,000
e. Taxable estate (a-b-c-d)	69,230,000
f. Prior taxable gifts	6,400,000
g. Cumulative taxable transfers ( e + f)	75,630,000
Tentative tax *	30,197,800
Current tax on adjusted taxable gift **	560,000
Gross estate tax	29,637,800
Unified credit	2,117,800
Estate tax due	27,520,000
Notes
* As Taxable Income is Above $ 1 Million the estate tax due is 40 percent Tax calcutation as follows :
Upto $ 1,000,000	345,800
$ 1,000,001 to 75,630,000 @ 40% Rate	29,852,000
Tentative Tax	30,197,800
** In 2011 Tax gifts Exemption limit is $ 5 Million so Adjusted Taxable Gift   = ( 6.4 million - 5 million) X 40%   = 560,000

Answer 2

How are you getting the Unified Credit Amount of $2,117,800?