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Accounting 6357 Section 001 Federal Estate and Gift Taxation Fall 2005 University of Texas at Dallas

Instructor: Christine Martinez, I.R.S. Attorney (Estate Tax) Office: UTD Email: UTD telephone: IRS Office 817-759-2900 Ext. 6201 Email: Home: 817-446-7287 Office Hours: TBA Email: Course Materials Required: -Stephens, Maxfield, Lind & Calfee, Federal Estate and Gift Taxation, 8th ed., 2002. -Study Problems Workbook. Supplement. -Federal Estate & Gift Tax Code and Regulations (CCH 2004) or latest update Course Coverage A comprehensive study of the principles and procedures involved in determining the federal estate, gift, and generation-skipping transfer taxes. This course studies these taxes and introduces fundamental estate planning techniques in light of the impact of these taxes. The taxability and valuation of property and the determination of deduction and credits will also be covered. The main objective of this course is to provide the student with an in-depth examination of these taxes with emphasis on research, planning, and problem solving using the Internal Revenue code, Regulations, cases, treatises and other authoritative sources of the law. The preparation of an estate and gift tax return will be part of this study. Approach to Study of Estate and Gift Tax This course will be taught primarily from a problem solving perspective. As will be explained in the first class. The problem method of instruction is particularly well suited to the study of tax. The required course materials are designed deliberately for use with the problem method. Class assignments are made by reference to the study problems (where more detailed assignments are found). Each problem requires reading from your text in conjunction with the study of code sections and regulations. The expected level of comprehension is best approximated by the assigned questions in the problem book. You may wish to survey those questions prior to beginning the reading. Occasionally material not assigned here will be addressed by lecture as a means of broadening course coverage. In such cases, some additional reading may be assigned.

Grading System Maximum Points 1. Two tests (100 points) 2. Preparation of tax returns Total points 200 100 300

Tax returns: Information concerning the tax returns will be presented at the appropriate time during the course. The returns will be take-home assignments. Class participation: Students should read the assigned chapter and complete the assigned problems prior to class and participate in class discussion. The final grade for the course may be enhanced as a result of class participation. Final Examination: The final examination is comprehensive. General Information 1. Make-up policy: Only for very compelling reasons will a make-up test be allowed. 2. Prerequisites: n/a 3. University Policy on Cheating: Students are expected to be above reproach in all scholastic activities. Students who engage in scholastic dishonesty are subject to disciplinary penalties, including the possibility of failure in the course and dismissal from the University. “Scholastic dishonesty includes, but is not limited to, cheating, plagiarism, collusion, the submission for credit or work of materials that are attributable in whole or in part to another person, taking an examination for another person, any act designed to give unfair advantage to a student or the attempt to commit such acts.” Rules and Regulations, Part One, Chapter VI, Section 3, Subsection 3.2, Subdivision 3.22. Since scholastic dishonest harms the individual, all students and the integrity of the University, policies on scholastic dishonesty will be strictly enforced.


Assignments AN INTRODUCTION TO PROPERTY LAW General discussion of state and federal property laws. Reading materials will be provided in class. AN OVERVIEW OF WEALTH TRANSFER TAXATION Chapters 1-3: Problem No.1 Read the assignment for Problem 1, but do not answer the questions. This Problem will be covered by lecture and in-class hypotheticals. PROPERTY OWNED AT DEATH – Section 2033, 2034 Chapter 4-4.06: Problem No. 2 GIFTS WITHIN THREE YEARS OF DEATH – Section 2035 Chapter 4.07: Problem No. 3 RETAINED LIFE ESTATES – Section 2036, Chapter 4.08: Problem No. 4 REVOCABLE TRANSFERS – Section 2038 Chapter 4.10: Problem No. 6 JOINTLY OWNED PROPERTY – Section 2040 Chapter 4.12: Problem No. 8 POWERS OF APPOINTMENT – Section 2041 Chapter 4.13: Problem No. 9 LIFE INSURANCE – Section 2042 Chapter 4.14: Problem No. 10 ALTERNATE VALUATION DATE AND FARM/BUSINESS VALUATION Chapter 4.03-4.04: Problem No. 11 Section 2032A Mid-term Exam

THE DEDUCTIONS FOR EXPENSES, DEBTS AND CLAIMS – Section 2053 Chapter 5.01-5.04: Problem No. 12 THE CHARITABLE DEDUCTION – Section 2055 Chapter 5.05: Problem No. 13


THE MARITAL DEDUCTION – Section 2056 Chapter 5.06: Problem No. 14

ESTATE TAX CREDITS – Section 2010 Chapter 3.01-3.05: Problem No. 15 TRANSFERS SUBJECT TO GIFT TAX Chapter 9.01-9.02, 10.01: Problem No. 16 VALUATION OF GIFTS Chapter 19.03: Problem No. 17 Chapter 10.02: Problem No. 18 DISCLAIMER AND THE GIFT TAX EXCLUSIONS Skim material concerning sections 2043 and 2516 Chapter 10.06-10.07: Problem No. 20 (omit questions 1 and 2) Chapter 9.05: Problem No. 21 (omit questions 4(f)-(h)) GIFT SPLITTING & GIFT TAX COMPUTATION Chapter 9.03-9.06, 10.03: Problem 23 THE COMBINED OPERATION OF THE ESTATE TAX & THE GIFT TAX Chapter 2.01, 3.02, 9.03, 9.05: Problem 24 THE GENERATION-SKIPPING TRANSFER TAX Chapter 12 and 13 of Stephens, Maxfield, Lind & Calfee. This topic will be covered briefly by lecture and in-class hypotheticals to be handed out in class. INCOME TAXATION OF ESTATES AND TRUSTS Skim code sections 641-692. This topic will be covered briefly by lecture. FUNDAMENTAL PLANNING TOOLS AND CURRENT TRENDS Most of the fundamental estate planning tools, recent trends in estate planning, and planning and drafting principles that we will cover in this course will be introduced during our study of the federal wealth transfer taxes above. At the end of the course, time permitting, we will discuss additional tools and trends in light of the impact of the federal wealth transfer taxes.

Specific reading and problems will be assigned in class.