This year Colleen transferred $100,000 to an irrevocable trust that pays equal shares of income annually to three cousins (or their estates) for the next eight years. At that time, the trust is to be terminated and the corpus of the trust will revert to Colleen. Assume the relevant interest rate is 6 percent. a-1. Determine the amount, if any, of the current gifts and the taxable gifts. Assume Colleen is unmarried. a-2. What is your answer if Colleen is married and elects to gift-split with the spouse? Note: For all requirements, round discount factors to 3 decimal places and other intermediate calculations and final answers to the nearest whole dollar amount. Leave no answer blank. Enter zero if applicable. a-1. Amount of current gift a-1. Amount of taxable gift a-2. Amount of current gift a-2. Amount of taxable gift $ 37,260
This year Colleen transferred $100,000 to an irrevocable trust that pays equal shares of income annually to three cousins (or their estates) for the next eight years. At that time, the trust is to be terminated and the corpus of the trust will revert to Colleen. Assume the relevant interest rate is 6 percent. a-1. Determine the amount, if any, of the current gifts and the taxable gifts. Assume Colleen is unmarried. a-2. What is your answer if Colleen is married and elects to gift-split with the spouse? Note: For all requirements, round discount factors to 3 decimal places and other intermediate calculations and final answers to the nearest whole dollar amount. Leave no answer blank. Enter zero if applicable. a-1. Amount of current gift a-1. Amount of taxable gift a-2. Amount of current gift a-2. Amount of taxable gift $ 37,260
Chapter19: Family Tax Planning
Section: Chapter Questions
Problem 17CE
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Question
Transcribed Image Text:This year Colleen transferred $100,000 to an irrevocable trust that pays equal shares of income annually to three cousins (or their
estates) for the next eight years. At that time, the trust is to be terminated and the corpus of the trust will revert to Colleen. Assume the
relevant interest rate is 6 percent.
a-1. Determine the amount, if any, of the current gifts and the taxable gifts. Assume Colleen is unmarried.
a-2. What is your answer if Colleen is married and elects to gift-split with the spouse?
Note: For all requirements, round discount factors to 3 decimal places and other intermediate calculations and final answers to
the nearest whole dollar amount. Leave no answer blank. Enter zero if applicable.
a-1. Amount of current gift
a-1. Amount of taxable gift
a-2. Amount of current gift
a-2. Amount of taxable gift
$
37,260
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