AEC10

ACTIVITY NO. 2

1. whether the following properties are includible in the estate of the decedent or not:

a. Salary from September 1 to 15 if the decedent died on September 16 of the current year.
He made a five (5) days cash advance prior to his death;
b. Rent income of apartment for the month of August which have not yet been collected;
c. Accrued interest on a savings account which have not yet been withdrawn;
d. Dividends on shares stock. The decedent died before the date of record;
e. Partial interest in a co-ownership;
f. A parcel of land inherited from an uncle who died a week ago. He was not yet taken
possession over the property;
g. Insurance on his life. His child is designated as the revocable beneficiary under such policy.
h. Jewelry worth a hundred thousand pesos received as donation from his paramour.
i. A brand new Isuzu Sportivo donated by a public works contractor to the Regional Director
of the PWDH in connection with the request to favor the former in the awarding of multi-
millionaire pesos contract.

2. Cathay’s employer owed Cathay P5, 000 on salary that had not been paid at the time of death.

a. Is Cathay’s right to that amount includible in her gross estate?

b. What if the P5, 000 is a benefit that Cathay’s employer agreed to pay to Cathay or her estate
only if she continued to work from the employer until her death or retirement, and Cathay
worked until the day she died?

3. Sue Tek insured his life for P450,000. In the policy, he designated his wife as the revocable
beneficiary.

a. In case of death of Sue Tek, will the proceeds of the life insurance become part of his estate?
b. How about if the designation to his beneficiary wife is irrevocable?

4. Sigurista sold to Tagapagmana a real property valued at P650, 000 for P300, 000 only. The
sale contains a reserved power to revoke the same while Sigurista is alive, which she failed to
exercise until his death. When Sigurista died, the property had a value of P750, 000.

a. How much should be included in the gross estate of Sigurista?

b. How about if it is discovered that the sale is fictitious?

5. Yolly took a life insurance policy upon her own life. The face value is P400, 000. When she died,
the insurance company paid her only daughter, Marietta, the proceeds of the insurance.
Marietta did not include the P400, 000 in the computation of the gross estate. Upon assessment,
the BIR official contends that there is deficiency tax having failed to include the insurance
proceeds in the gross estate. Is the tax official correct?

6. Ara Nina, 85 years old and aware of her serious illness, sold a property with a value of P800,
000 for a consideration of P300, 000 to Dina Ngona. After a month, she died leaving a net estate
after the deducting the estate tax of P3, 000, 000. How much is the net distributable estate of
Ara Nina if the Property sold to Dina Ngona Had a value of P840, 000 at the time of death?

7. Bonador donated to Atacador a parcel of land in 2010. Bonador made the deed of donation
entitled “Donation Inter Vivos” in a publc instrument and Atacador accepted the donation in the
same document. It was provided in the deed that the land donated shall be immediately
delivered to Atacador and Atacador shall have right to enjoy the fruits fully. The deed also
provided that Bonador was reserving the right to dispose of said land during his (Bonador’s)
lifetime, and that Atacador shall not register the deed of donation until Bonador’s death. Upon
Bonador’s death, Curiadora, Bonador’s widow and sole heir, filed an action for the recovery of
the donated land, contending that the donation made by Bonador is a donation mortis causa
and not donation inter vivos. Will said action prosper?

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