Ann, age 61, and Bob, age 62, have a large number of investments in common stock of publicly traded corporations, some municipal bonds, and a money market cash account worth several million dollars. In addition, they own a ranch in Texas that may be worth $100,000,000. They have a large family consisting of three sons, four daughters, and fifteen grandchildren. What are some alternatives that Ann and Bob could consider in order to reduce their taxable estate, assuming that the estate tax law is not yet abolished or amended by Congress before the two taxpayers die? What are the consequences if Ann and Bob decide to gift investments worth $1,000,000 to each of their children and grandchildren? What are the consequences of leaving a large estate that will be divided among their children and grandchildren?

PART TWO:

1. What is the amount of Bob's total gifts for 2022, assuming no election for gift splitting? a. $22,000,000 b. $21,648,000 c. $9,940,000 d. $11,000,000 e. $10,648,000 f. $0

2. What is the amount of Ann's total gifts for 2022, assuming no election for gift splitting? a. $22,000,000 b. $21,648,000 c. $9,940,000 d. $11,000,000 e. $10,648,000 f. $0

3. What is the amount of Bob's total taxable gifts for 2022, assuming no election for gift splitting? a. $22,000,000 b.$21,648,000 c. $9,940,000 d. $11,000,000 e. $10,648,000 f. $0

4. What is the amount of Ann's total gifts for 2022, assuming no election for gift splitting?? a. $22,000,000 b. $21,648,000 c. $9,940,000 d. $11,000,000 e. $10,648,000 f. $0

5. What is gift splitting and how would you answer questions 1, 2, 3 and 4, if Bob and Ann make the election?

6. What is Bob's tentative gift tax for 2022 assuming he and Ann did not elect gift splitting? Show how you calculated it.

7. What is Bob's tentative gift tax for 2022 assuming he and Ann elected gift splitting? What is Ann's tentative tax? Show how you calculated the tentative tax amounts.