Chapter $15$

Financial Planning Exercise $7$

Calculation of estate taxes

Use Worksheet $15\mathrm{.}1.$ When Jackson Holmes died in $2018,$ he left an estate valued at $$8,050,000.$ His trust directed distribution as follows: $$20,000$ to the local hospital, $$150,000$ to his alma mater, and the remainder to his three adult children. Death$-$related costs were $$16,900$ for funeral expenses, $$40,000$ paid to attorneys, $$3,500$ paid to accountants, and $$30,000$ paid to the trustee of his living trust. In addition, there were debts of $$135,000.$ Use Worksheet $15\mathrm{.}1$ and Exhibit $15\mathrm{.}5$ and Exhibit $15\mathrm{.}6$ to calculate the federal estate tax due on Jackson's estate. Round your answer to nearest whole dollar.

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