DESCRIPTION
This module provides an in-depth review of federal gift tax principles, focusing on identifying when a transfer is a gift and when that gift is considered complete. Participants evaluate gifts made to trusts, including the treatment of different beneficiary interests, present interest requirements, and the use of Crummey withdrawal powers to qualify for the annual exclusion. Through applied fact patterns, the module reinforces the mechanics of the annual exclusion and lifetime exemption. The course concludes with a comprehensive walkthrough of computing gift tax liability using Form 709 and determining basis adjustments when gift tax is paid.
LEARNING OBJECTIVES
- Identify transfers that constitute gifts for federal gift tax purposes.
- Classify trust beneficiaries as income, remainder, or contingent beneficiaries.
- Analyze fact patterns to determine when a gift is considered made and when it is completed for gift tax purposes.
- Assess client fact patterns to recommend strategies that optimize use of the annual exclusion.
- Calculate total gift tax liability by aggregating current and prior taxable gifts and applying the gift tax rate schedule.
- Calculate basis adjustments for gifted property when gift tax is paid and determine when such adjustments are required.
