Question

Barry and his wife Mary, have accumulated over $3.5 million during their 50 years of marriage. They have three children and five grandchildren. What is the total amount of estate removed from Barry and Mary's estate in 2017 if they gift the maximum allowable amount to their children and grandchildren without incurring any gift taxes?

Answer 1

Answer:

$224,000

Explanation:

The money which Berry and Mary gift to their children and grand children in 2017 without any gift tax liability is as follows:

Children:

According to the policy, they can gift up to $14,000, without gaining any gift tax liability.

So, amount given by them is $14,000 x 3 (number of children) x 2 (Barry and Mary) = $84,000

Grandchildren :

According to the policy, Barry and Mary can gift up to $14,000 without gaining any gift tax liability.

So, amount given by them is $14,000 x 5(number of children) x 2 (Barry and Mary) = $140,000

And therefore, the total amount of estate removed from Barry and Mary's estate is as follows:

$84,000 + $140,000 = $224,000