Jean died in a common-law state in 2023 and was survived by her husband, Loren, and three adult children. Jean's gross estate, all of which was owned solely in her name, was composed of the following assets and date of death fair market values: Assets Values Common stock $ 4,900,000 Residence 750,000 Personal property 60,000 IRAs 3,450,000 Hummel figurines 175,000 Total Assets $ 9,335,000 Jean's only liabilities, together with their date of death balance, were as follows: Liabilities Balance Mortgage on residence $175,000 Car loan 8,000 Total $183,000 The following is a list of all of the gratuitous transfers that Jean made during her lifetime: 2000: Placed the common stock listed above in an irrevocable trust in which she retained the right to a 5% distribution of the trust account revalued annually for 25 years with the remainder to her children at her death; the date of gift fair market value of the stock was $190,000; the value of Jean's retained interest on the date the gift became complete was $90,000 2001: A cash gift to her niece of $30,000, which Loren agreed to split 2005: Paid the University of Iowa $11,000 for her youngest child's tuition 2020: Gave her brother $70,000 in cash, which Loren agreed to split Jean's will, executed in 2000, gave the residence and personal property to Loren and the Hummel figurines to a qualified charity. Jean's three children were designated as equal beneficiaries of her IRAs. Each beneficiary of Jean's estate was to pay any transfer tax due on the portions of the estate received. Her will also stipulated that any real property was to be received subject to the mortgage. Further, her will stipulated that funeral and administrative expenses were to be paid equally by her husband and three children. These funeral and administrative expenses amounted to $60,000 for Jean's estate. Jean's estate paid state death taxes in the amount of $4,184, and will pay off the car loan. Which one of these amounts most closely approximates the net federal estate tax due from Jean's estate? Use the Unified Federal Estate and Gift Tax Rates table. A) $1,455,800 B) $999,699 C) $0 D) $106,517
Jean died in a common-law state in 2023 and was survived by her husband, Loren, and three adult children. Jean's gross estate, all of which was owned solely in her name, was composed of the following assets and date of death fair market values:
| Assets | Values |
|---|---|
| Common stock | $ 4,900,000 |
| Residence | 750,000 |
| Personal property | 60,000 |
| IRAs | 3,450,000 |
| Hummel figurines | 175,000 |
| Total Assets | $ 9,335,000 |
Jean's only liabilities, together with their date of death balance, were as follows:
| Liabilities | Balance |
|---|---|
| Mortgage on residence | $175,000 |
| Car loan | 8,000 |
| Total | $183,000 |
The following is a list of all of the gratuitous transfers that Jean made during her lifetime:
- 2000: Placed the common stock listed above in an irrevocable trust in which she retained the right to a 5% distribution of the trust account revalued annually for 25 years with the remainder to her children at her death; the date of gift fair market value of the stock was $190,000; the value of Jean's retained interest on the date the gift became complete was $90,000
- 2001: A cash gift to her niece of $30,000, which Loren agreed to split
- 2005: Paid the University of Iowa $11,000 for her youngest child's tuition
- 2020: Gave her brother $70,000 in cash, which Loren agreed to split
Jean's will, executed in 2000, gave the residence and personal property to Loren and the Hummel figurines to a qualified charity. Jean's three children were designated as equal beneficiaries of her IRAs. Each beneficiary of Jean's estate was to pay any transfer tax due on the portions of the estate received. Her will also stipulated that any real property was to be received subject to the mortgage. Further, her will stipulated that funeral and administrative expenses were to be paid equally by her husband and three children. These funeral and administrative expenses amounted to $60,000 for Jean's estate. Jean's estate paid state death taxes in the amount of $4,184, and will pay off the car loan.
Which one of these amounts most closely approximates the net federal estate tax due from Jean's estate? Use the Unified Federal Estate and Gift Tax Rates table.
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