8. Assume that Harry made a taxable gift of $1,500,000 in 2007. At that time, the exemption equivalent for the gift tax was $1 million, so Harry paid gift taxes on $500,000. Harry has not made any taxable gifts since 2007. This year, however, harry made taxable gifts of $585,500. What is Harrys gift tax on the transfer?

Please solve it step by step. Thank you.

I do not understand how we get the tax part.

Current taxable gifts Prior taxable gifts Cumulative taxable g Tax on cumulative taxable Less: Current tax on