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I need help in calculating gross estate and probate estate 3. Assuming Henry died today, calculate his gross estate. 4. Assuming Henry died today, calculate
I need help in calculating gross estate and probate estate
3. Assuming Henry died today, calculate his gross estate.
4. Assuming Henry died today, calculate his probate estate.
Zoom out COMPREHENSIVE CASE wilma and Henry Bacleground Wilma and Henry have been married for 50 years and are both in good health. Wilma and Henry live in a community property state. They have the following children and grandchildren: Children Rachel Sarah Heather Tiffany Age 45 Age 35 Age 32 Deceased Grandchildren 3 children 4 children No children 1 child Rachel, a chef, is married, healthy, and happy. Wilma and Henry adore Rachel's husband, Ross, and their three children, Sarah, a high net worth investment consultant, was recently divorced and her ex-husband, Freddie, has custody of their four children. Wilma and Henry, never quite cared for Freddie, as he always seemed to be quite snooty. Since the divorce, the relationship between Wilma and Freddie has been very strained. Since her divorce, Sarah has had somewhat of a mid- life crisis. She recently rented a penthouse apartment and bought a new Corvette. Sarah has also been dating Luka, a 21-year-old swimsuit model. While Wilma and Henry are confident that this is only a passing phase, they are concerned about giving any gifts to Sarah or her children outright. Heather is a high school teacher who has never been married and has no children. Heather Heather has aspirations of going to graduate school to become a principal but is concerned about taking on debt to pursue additional education. Wilma and Henry are considering helping Heather pay for graduate school tuition. Tiffany, Wilma and Henry's youngest child, was a bit of a wild child. Tiffany died in a tragie accident in her senior year of college while she was on her way home to tell her parents about a big secret she had been keeping. The summer before, Tiffany had given birth to a baby girl named Amara. At the time, Tiffany gave the baby to the baby's father, an older married man, although no official adoption was ever transacted. Wilma and Henry still do not know about Amara Wilma and Henry own Hoppy Days Brewing, a popular brewery, Ross, Rachel's husband, has worked at the business since he was in high school. Ross is now the manager and handles most of the day to day functions, with very little input from Wilma and Henry Wilma and Henry would like to reward Ross for all of his hard work by giving Ross and Rachel 1/2 of the business and giving the remaining 1/2 of the business to Sarah and Heather equally, They do not want Sarah and Heather to have any control over the business, just to have an income interest Rachel's youngest child, Emma was born with a serious physical disability. To provide additional support for Emma, Henry created an irrevocable trust with Emma as the sole beneficiary with a $5,000,000 transfer of separate property in 2013. The trust meets the requirements of Section 2503(e). Wilts Wilma does not have a will, Henry has an outdated will leaving most of his probate assets to Wilma. Clauses from Henry's Statutory Last Will and Testament 1. Henry, being of sound mind and wishing to make proper disposition of my property in the event of my death, do declare this to be my Last Will and Testament. I revoke all of my prior wills and codicils. 1. I have been married but once, and only to Wilma with whom I am presently living. Out of my marriage to Wilma, four children were born, namely Rachel, Sarah, Heather, and Tiffany. I have adopted no one nor has anyone adopted me. 2. I leave my Vintage Rolls Royce and House Boat to my daughter, Sarah. 3. I leave the life insurance proceeds on my life to my daughter, Rachel. 4. I leave Vacation Home 1 to my daughter, Tiffany. 5. I leave Auto 1 to the Methodist Church, a qualified charity. 6. I give the residue of my estate to Wilma, my wife. 7. In the event that Wilma predeceases me or fails to survive me for more than six (6) months from the date of my death, I leave any interest of my estate determined to be payable to her to my children, Rachel, Sarah, Heather, and Tiffany, in equal and 1/4 shares. 8. In the event that any of the named legatees should predecease me, die within six months from the date of my death, disclaim, or otherwise fail to accept any property bequeathed to him or her, then such interest will pass to the said legatee's descendents, otherwise his or her share of all of my property of which I die possessed shall be paid equally among the surviving named legatees. 9. I name my best friend Keith to serve as the executor of my succession with full seizin and without bond. 10. I direct that the expenses of my last illness, funeral, and the administration of my estate shall be paid by my executor as soon as practicable after my death and allocated against the residual estate 11. Since I have made numerous lifetime gifts to my children, all inheritance, estate, succession, transfer, and other taxes (including interest and penalties thereon) payable by reason of my death shall be allocated to the children's share, regardless of whether my spouse survives me STATEMENT OP PINANCIAL POSITION (HENRY & WILMA) ASSETS Cash/Cash Equivalents CP Cash Total Cash/Cash Equivalents $ 1,462,500 $ 1,462,500 LIABILITIES AND NET WORTH Liabilities Current Liabilities CP Credit Card 1 CP Credit Card 2 Total Current Liabilities $ $ $ 251,840 56,750 308,590 Invested Assets CP Hoppy Days Brewery H Inherited Stock Portfolio H Life Insurance on Henry CP Rental Property W Inherited Stock Portfolio Total Investments $ 14,500,000 $ 3,217,500 $ 1,250,000 $ 855,000 $ 2,740,000 $22,562,500 Long-Term Liabilities CP Mortgage - Primary W Mortgage - Vacation Home 2 H Yacht Total Long-Term Liabilities $ 1,579,500 $ 321,750 $ 1,000,000 $ 2,901,250 Total Liabilities $ 3,209,840 Personal Use Assets CP Primary Residence H Vacation Home 1 W Vacation Home 2 CP Personal Property H Auto 1 W Auto 2 CP Vintage Rolls Royce H Yacht Total Personal Use $ 3,088,000 $ 982,000 $ 788,500 $ 1,250,000 $ 109.980 $ 72,210 $ 250,500 $ 1.755,000 $ 8,296,190 Net Worth $29,111,350 Total Assets $32,321,190 Total Liabilities and Net Worth $32,321,190 Notes to Financial Statements: 1. Assets are stated at fair market value (rounded to even dollars). 2. Liabilities are stated at principal only (rounded to even dollars). 3. The adjusted basis of the primary residence is $1,600,000. 4. Wilma received vacation home 2 from her grandmother. Lois. Wilma and Lois were always very close and Lois gave her the home when Rachel was first born so Wilma could enjoy motherhood as much as Lois had. Lois purchased the vacation home for $15,000 and the FMV of the home at the date of transfer was $280,000. The FMV when Lois died was $350.000 5. The life insurance policy has Wilma listed as the designated beneficiary. The inherited stock portfolios are Transfer on Death accounts with Rachel, Sarah, and leather is the listed beneliciaries of both Henry and Wilma 's shares. 6. The Yacht was purchased by Henry after his House Boat was destroyed by a llurricane 7 Property Ownership CP - Community Property 11 Husband separate W Wife separate & Insurance face valise death bestell and the cash value $1,000,000 Te same Answer the following questions. Assume the engiva m the set paltern and that the 2020 states and tax rates and anual exilusions apply unless otherwise bdicated Numbers founder for convenience sol the following terme munits will be appropriate for the So Sil Rachel and HeaterStep by Step Solution
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