Overview: When an individual dies, their tax obligations do not

Overview:

When an individual dies, their tax obligations do not cease but instead pass on to the estate. In addition to filing an individual income tax for the decedent for income earned up through the date of death, the administrator of the estate must also file income tax returns to report the income earned by the estate during the estate administration period. Finally, if the value of the estate exceeds a certain amount, an estate tax may also be owed. However, as is the case with other forms of taxation, careful tax planning can reduce the amount owed. In this group discussion activity, you will address the three considerations below, as assigned by your instructor, related to estate tax planning for Andy, one of the clients in the final project scenario. 

Prompt: 

Create a discussion post that fully address the three following estate tax planning considerations for Andy from the final project scenario: 

1. The amount of estate tax attributable to Andy’s ownership interest (Assume that, because of the value of other assets owned by Andy and his wife, 100% of the value of Andy’s Tai-Ga ownership interest will be taxable, and that Andy and his wife own the Tai-Ga interest jointly.) 

2. A recommendation for methods to reduce the taxable value of the estate. 

3. A recommendation for methods to structure payment of the estate tax due after Andy passes away (Assume that any payment by the purchaser of Andy’s ownership interest in Tai-Ga will be made in equal annual payments at an 8% interest rate over a period of 10 years.) 

Specifically, the following critical elements must be addressed: 

A. Provide a thorough, accurate, and appropriate analysis of all of the factors related to the assigned considerations.  

B. Explain how relevant tax law and regulation apply to these considerations. 

C. Justify your conclusion using credible, relevant, and scholarly resources as supporting evidence. 

NB:

Due Wednesday May 18, 2022

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