Question #64 of 85 Question ID: 1251864Your deceased client had a gross estate valued at $14 million. His estate includes approximately equal values of the following:Limited partnership interests that he has owned for four years in commercial office and retail buildings; these interests recently have shown less than 1% growth per year but nevertheless still produce significant incomeRenovated apartments that have been decreasing in value at the rate of 12% per year due to deterioration of the neighborhood in which they are locatedPersonal property such as his home, cars, furnishings, and collections; the real estate values in his area have remained steady for the last several yearsYour client's estate tax bracket is the highest allowed for the year of death. He has named his 21-year-old grandson as the executor of his estate. The grandson's income tax bracket is 12%.If the grandson came to you for advice, you should inform him that the postmortem action available and advisable to minimize estate tax liability for his grandfather's estate is A)the use of special use valuation on the commercial real estate holdings. B)the use of the alternate valuation date for estate assets. C)establish an intentionally defective grantor trust D)a waiver of executor commissions for the estate.

The business should be run as per the market conditions, and requirement. The resources for the…

Answered: Your deceased client had a gross estate…

Understanding Business

12th Edition

ISBN:9781259929434

Author:William Nickels

Publisher:William Nickels

Chapter1: Taking Risks And Making Profits Within The Dynamic Business Environment

Section: Chapter Questions

Problem 1CE

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Question #64 of 85

Question ID: 1251864

Your deceased client had a gross estate valued at $14 million. His estate includes approximately equal values of the following:

Limited partnership interests that he has owned for four years in commercial office and retail buildings; these interests recently have shown less than 1% growth per year but nevertheless still produce significant income
Renovated apartments that have been decreasing in value at the rate of 12% per year due to deterioration of the neighborhood in which they are located
Personal property such as his home, cars, furnishings, and collections; the real estate values in his area have remained steady for the last several years

Your client's estate tax bracket is the highest allowed for the year of death. He has named his 21-year-old grandson as the executor of his estate. The grandson's income tax bracket is 12%.

If the grandson came to you for advice, you should inform him that the postmortem action available and advisable to minimize estate tax liability for his grandfather's estate is

the use of special use valuation on the commercial real estate holdings.

the use of the alternate valuation date for estate assets.

establish an intentionally defective grantor trust

a waiver of executor commissions for the estate.

Definition Definition Arrangement between two or more people whereby they agree to manage business operations and share its profits and losses in an agreed ratio. The agreement drafted and signed by the partners of the firm is termed as a partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, and drawings of a partner.

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