Martin has three children, whose names are Stanford, Ben, and Chase. Stanford named his only child Junior. Ben named his only child Brooke. And Chase named his only child Tracy.
In 2004, Martin sold his 1,600 acre parcel of land in South America to a ski resort developer for well over $100 million. He immediately consumed his entire life time exemption from gift and estate taxes and his entire lifetime exemption from generation skipping transfer taxes by making gifts to his three grandchildren.

In 2008 Chase (a son) died. Stanford and Ben were still alive at the time of Martin’s death. Junior (a grandson) married Laura, but never could get along with his grandfather, Martin. When Martin died in 2020 he had only $6 million in assets left. His Will provides that $2 million goes to his granddaughter, Brooke; $2 million to his granddaughter, Tracy; and the final $2 million was given to Junior’s wife, Laura.

Assuming a 40% tax rate applicable to gift, estate, and generation skipping taxes, compute all applicable transfer taxes (gift, estate, and generation skipping taxes) arising at the time of Martin’s death?

Answer rating: 100% (QA)

The applicable transfer taxes wo... View the full answer