Sarah and Clem Are Very Wealthy and Have a Program

question 49

Essay

Sarah and Clem are very wealthy and have a program of charitable and family giving. In 2017, they give $20,000 to each of their 4 grandchildren, $30,000 to Clem's brother, stock valued at $40,000 (basis = $20,000) to the Cancer society, and they buy a home valued at $525,000 for Sarah's mother. In addition, Clem puts $500,000 of his stock in the family's business into Sarah's name and sets up a revocable trust for Sarah's sister with $100,000 in bonds. If Clem made $1,900,000 and Sarah $1,300,000 in taxable gifts in 2016, their only prior-year taxable gifts, what are Clem's and Sarah's taxable gifts in 2017 if they elect gift splitting?

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Definitions:

PPE (Personal Protective Equipment)

Equipment worn to minimize exposure to hazards that cause serious workplace injuries and illnesses, including gloves, masks, and goggles.

Airborne Pathogens

Microorganisms that are carried in the air and can cause disease when inhaled by humans or animals.

Immunizations

The process of making a person immune to an infectious disease, typically by the administration of a vaccine.

Immunizations

The process or procedure by which an individual becomes protected against diseases through vaccination.