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[answered] At his death in 2012, Zoltan's will provided for the c


At his death in 2012, Zoltan's will provided for the creation of a trust into which his entire $15 mil. estate was to be transferred. The terms of the trust provide for Zoltan's wife to receive the income from the trust for as long as she lives.? Upon the death of Zoltan's widow, the trust is to be terminated and distributed in equal shares to Zoltan's surviving children (or to the grandchildren, in the event that a child pre-deceased Zoltan's widow), except that the trust would not be terminated until the youngest of the remainder beneficiaries of Zoltan's trust reached the age of 30. All of Zoltan's children were alive when he died, but all of the children had died by the time Zoltan's widow died. Because Zoltan had not used any of his GST exemption during his lifetime, his entire GST exemption ($5,120,000 in 2012) was automatically allocated to his testamentary trust at his death. On a timely filed estate tax return, Zoltan's executor made a $6,000,000?(i.e., 40%) QTIP election with respect to this trust. When Zoltan's widow died, the youngest grandchild was 25; therefore, the trust continued to hold the property for the benefit of the grandchildren for 5 more years.?Determine the GST due, if any, at each of the following event dates.

? ?? ?? ?-? ? ?? ?? ?A.? ? ?? ?? ?B.? ? ?? ?? ?C.? ? ?? ?? ?D.? ? ?? ?? ?E.? ? ?? ?? ?F.? ? ?? ?? ?G.? ? ?? ?? ?H.? ? ?? ?? ?I.? ?? ?

After the QTIP election, Zoltan s taxable estate is $9,000,000 ($15 mil. less?$6 mil.?MD).? Zoltan's testamentary trust was funded with $13,642,000 (Zoltan's $15,000,000 TE less estate tax of $1,358,000).

? ?? ?? ?-? ? ?? ?? ?A.? ? ?? ?? ?B.? ? ?? ?? ?C.? ? ?? ?? ?D.? ? ?? ?? ?E.? ? ?? ?? ?F.? ? ?? ?? ?G.? ? ?? ?? ?H.? ? ?? ?? ?I.? ?? ?

The death of Zoltan's widow in 2015, when the trust was worth $20 mil.

? ?? ?? ?-? ? ?? ?? ?A.? ? ?? ?? ?B.? ? ?? ?? ?C.? ? ?? ?? ?D.? ? ?? ?? ?E.? ? ?? ?? ?F.? ? ?? ?? ?G.? ? ?? ?? ?H.? ? ?? ?? ?I.? ?? ?

When Zoltan s youngest grandchild reached the age of 30 and the trust property was distributed to the grandchildren, when trust value was $25 mil.

A.

$2,766,400 (allow for rounding)

B.

$5,120,000

C.

$2,998,504 (allow for rounding)

D.

$3,143,679 (allow for rounding)

E.

$2,074,800 (allow for rounding)

F.

$7,000,000

G.

None of the answers is correct.? See my submission in Supporting Documents for my answer and/or computations.

H.

$ 3,457,800 (allow for rounding)

I.

$0

 


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