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Merlo
Merlo, Accountant
Category: Tax
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Experience:  25+ years tax consulting. Specializing in returns for US citizens living abroad
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I am trying to study for a test and have confused myself.

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I am trying to study for a test and have confused myself. I am trying to figure our gift and estate taxes. I have a taxable gift of $5 milion dollars. I need to calculate the gift tax for 2007 and 2009. The answer states they are the same and I calculated correctly for 2007 - 1,785,000but why is it the same for 2009 ? I know the rate and unified credit did not change. but I thought the exclusion was different. I am having trouble reading schedule 2001(c). Any help would be appreciated.

Hello tuffcookie,

 

The exclusion amount for estates did change for those two years, but the exclusion did not change for gifts alone. The gift limit exclusion was still $1 million for both of those years. Once a person gave more than $1 million in gifts in either of those years, taxes became due on the gifts which exceeded the $1 million.

 

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Thank you tuffcookie

 

 

 

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