Question$5$: FACTS: D$,$ a U$.$S$.$ nonresident alien domiciliary for U$.$S$.$ estate, gift and generation$-$ skipping transfer tax purposes, is a citizen, resident and domiciliary of Country X$.$ D is married to W$,$ a U$.$S$.$ citizen, and D and W have two U$.$S$.$ citizen sons, S$-1$ and S$-2.$ W$,$ S$-1$ and S$-2$ reside with D in Country X$.$ The U$.$S$.$ and Country X have no tax treaties with one another. D owns the following assets, the values of which appear in parenthesis after each asset:

Real estate in Country X $($$$400,000).$

A sole proprietorship and tangible personal property both situated in Country X $($$$2,500,000).$

A condominium in New York City, New York $($$$750,000).$

Shares of stock of FC$,$ a properly incorporated, structured, and maintained foreign company whose assets consist $100\%$ of US real estate $($$$800,000).$

$100\%$ of the shares of stock of PENNCO, a Pennsylvania company, whose assets consist $100\%$ of real estate located in Country X $($$$2,000,000).$

A debt obligation of NYCO, a New York corporation, upon which the interest is exempt from US income tax under the "Portfolio Interest Exemption" $($$$700,000).$

Cash in a US safe deposit box with B$-$Bank, a Florida bank $($$$250,000).$

A face value life insurance policy on D$$s own life with LifeCo, a Pennsylvania life insurance company $($$$1,000,000).$

Furniture and personal property situated in the New York City, New York condominium $($$$100,000).$

A note receivable from PENNCO, D$$s $100\%$ owned Pennsylvania company $($see above$)-($$$500,000).$

During $2024,$ D is entitled to a gift tax unified credit of:

$$0$

$$5,541,800$

$$13,000$

$$3,600$

Using the facts as in question $5.$ above, if D were to die owning assets $1.-10.$ above and W had predeceased D so that no marital deduction would be available, D$\text{'}$s estate would not have to disclose D$\text{'}$s worldwide gross estate to determine its pro rata deduction for IRC $2053$ and $2054$ expenses, indebtedness, taxes and losses.

True

False

Using the same facts as in question $5.$ above, if D makes a gift of asset $3.$ to W$,$ no marital deduction will be available because D is a nonresident alien domiciled donor.

True

False

Using the same facts as in question $5.$ above, assume further that S$-1$ and S$-2$ each have U$.$S$.$ citizen children that reside with S$-1$ and S$-2,$ respectively, in Country X$.$ If D gifts assets $3.$ and $9.$ above to the children of S$-1$ and S$-2$ outright, and assuming D has no generation$-$skipping transfer tax exemption available, D$\text{'}$s gifts will be subject to generation$-$skipping transfer tax.

True

False