James A. and Ella R. Polk, ages 70 and 65, respectively, are retired physicians who live at
Question:
James A. and Ella R. Polk, ages 70 and 65, respectively, are retired physicians who live at 3319 Taylorcrest Street, Houston, Texas 77079. Their three adult children (Benjamin Polk, Michael Polk, and Olivia Turner) are mature and responsible persons. The Polks have heard that some in Congress have proposed lowering the Federal gift tax exclusion to $3 million.
Although this change likely will not occur, the Polks believe that they should take advantage of the more generous exclusion available under existing law. Thus, the Polks make transfers of many of their high-value investments. These and other gifts made during the year are summarized below.
Prepare 2018 gift tax returns (Form 709) for both of the Polks to compute the total taxable gifts (line 3) for James and Ella; stop with line 3 of page 1, but complete pages 2 and 3 of the return. An election to split gifts is made.
The Polks have made no taxable gifts in prior years. Relevant Social Security numbers are 123-45-6789 (James) and 123-45-6788 (Ella).
Step by Step Answer:
South-Western Federal Taxation 2020 Comprehensive
ISBN: 9780357109144
43rd Edition
Authors: David M. Maloney, William A. Raabe, James C. Young, Annette Nellen, William H. Hoffman