Question

In both the gift tax and the estate tax, a credit is allowed to reflect transfer tax paid on taxable gifts made in prior years. However, if the tax rates in the current year differ from the tax rates in force in the prior year, the credit allowed will not be the same as the taxes computed on the original gift tax return for the prior year. In this case, the credit must be recomputed using current rates. Answer each of the following questions relating to the credit for transfer taxes on prior year's taxable gifts. As a reminder, in the gift tax formula, the credit is the tentative tax on prior years' taxable gifts. In the estate tax, the credit is gift tax paid (i.e., reflecting the application of the unified credit in the year of the prior gift, with both the unified credit and the tentative tax recomputed if needed). A.None of the other answers is correct B.$0 C.$175,000 D.$600,000 E.$200,000 F.$525,000 G.$345,800 Q1 - The current year is 2015. In 2009 a taxable gift of $1,500,000 was made, with gift tax due of $210,000. In the estate tax formula for 2015, what is the credit allowed for the 2009 gift tax? Q2- The current year is 2015. In 2010 a taxable gift of $1,500,000 was made, with gift tax due of $175,000. In the estate tax formula for 2015, what is the credit allowed for the 2009 gift tax? Q3 -The current year is 2015. In 2013 a taxable gift of $1,500,000 was made, but no gift tax was due. Q4 - In the estate tax formula for 2015, what is the credit allowed for the 2013 gift tax? Q5 -The current year is 2015. In 2005 a taxable gift of $1,500,000 was made, with gift tax due of $210,000. In the gift tax formula for 2015, what is the credit allowed for the 2009 gift tax?

Answer 1