ESTATE & GIFT TAX RETURN

2026 Life time exemption

$15M doner to each donee during the life time of the donor

2026 Annual Gift Exclusion

$19K doner to each donee in a year

Unified Rate

Using same tax rates for both gift and estate tax return.

Anti-Clawback Rule

Taking advantage of the tax benefits even when it changes later

Clawback Rule

Assets transferred withing 3 yrs from donor’s death included in the estate for tax purposes

Intestate

Dying without a will

Testamentary Trust

Established through the terms of the will

Deduction rule for medical and education expenses for estate return

Unlimited deduction as long as directly paid

What is “Deceased Spousal Unused Exclusion” (DSUE)?

Surviving spouse using deceased spouse’s unused life time exemption for gifts.

How to elect DSUE?

Executor of the deceased files Form 706 by 9 months after death

Basis of assets heirs receive per Sec. 1014?

FMV at date of death of donor

Name 5 credit offsetting estate tax liability

1) Applicable credit 2) Tax on pre-1977 gifts 3) Tax on Prior transfers 4) Foreign death tax credits

Equation for estate tax liability

Gross estate - deduction= taxable estate + lifetime gits= subtotal x tax rate = tentative tax - gift tax paid = Gross estate tax - credits = estate tax liability