Chapter 14 Discussions This discussion relates to the course material that you studied in Week 7: Chapter 14 Transfer Taxes and Wealth Planning of this course. For This Discussion Gift/Estate Tax Applicable Credit: The objective of the applicable credit is to prevent the application of either the gift or estate tax to taxpayers who would not accumulate a relatively large amount of property transfers during their lifetime and/or would not have a relatively large value of assets to pass on to heirs upon their death. The amount of cumulative taxable transfers that can be made without exceeding the applicable credit is referred to as the exemption equivalent and as scheduled is $11.58 million for both the estate and gift taxes in 2020. Incomplete Transfer: A gift is defined as a transfer for inadequate consideration such as a transfer for love and affection. Hence, transfers for adequate consideration are not gifts for transfer tax purposes. For example, the gift tax is not imposed on payments associated with sales of goods or services because these transfers occur in a business context where consideration (money) is exchanged for the goods or services. Neither is the satisfaction of an obligation considered a gift. For