Solved by verified expert :2402. CHAPTER
19—FAMILY TAX PLANNING Question ES #1
Mel’s estate includes a number of notes receivable signed by his daughter,
Tammy. These notes were issued by Tammy on different occasions when she
obtained funds from Mel. The total face amount of these notes is $150,000. The
notes are forgiven by Mel’s will. How much, if any, regarding these notes
should be included in Mel’s gross estate?
2403. CHAPTER
19—FAMILY TAX PLANNING Question ES #2
Wesley has created an irrevocable trust: life estate to Eve, remainder to
Ernest upon Eve’s death. In using the IRS valuation tables, what information is
needed to determine the value of Eve’s life estate?
.
2404. CHAPTER
19—FAMILY TAX PLANNING Question ES #3
Barney creates a trust, income payable to Chloe for five years, remainder to
Emma. Emma is Barney’s daughter (and a single parent), and Chloe is his 19-year
old granddaughter. What might be the justification for this type of trust?
.
2405. CHAPTER
19—FAMILY TAX PLANNING Question ES #4
Using investments worth $1 million, Roland establishes a trust, life estate to
Melinda, remainder to Kim.
a.
Has Roland made one gift or two gifts?
b.
What difference does it make?
2406. CHAPTER
19—FAMILY TAX PLANNING Question ES #5
If the special use valuation method of § 2032A is elected and certain
continuing requirements are not satisfied, recapture occurs.
a.
What is the amount of recapture and upon whom is it imposed?
b.
In terms of basis for income tax purposes, what effect does
recapture under § 2032A have?
2407. CHAPTER
19—FAMILY TAX PLANNING Question ES #6
What are some of the pitfalls in the use of § 2032A (special use valuation
method)?
2408. CHAPTER
19—FAMILY TAX PLANNING Question ES #7
In arriving at the value of stock in a closely held business, the IRS
frequently imputes goodwill. Comment on how the following independent factors
would affect the determination of goodwill.
a.
Past profits include a large nonoperating gain.
b.
Shareholder-employees have not been receiving adequate
compensation for their services.
c.
The shareholders have been financing corporate operations with
interest-free loans.
