BUISENESS MANAGEMENT
TAXES
|
Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
|
|
|
Bank loans acquired for the medication of the decedent
|
|
|
Income tax of the decedent before death
|
|
|
Sole obligation of the surviving spouse
|
|
|
Real property tax of the separate estate of the surviving spouse
|
Detailed explanation-1: -A deduction from the gross estate is allowed for funeral expenses, administration expenses, claims against the estate, certain taxes, and unpaid mortgages or other indebtedness allowable under the local law governing the administration of the decedent’s estate ( Code Sec.
Detailed explanation-2: -Gross estate includes essentially all substantially valuable property owned by the person at death, including real estate, cash, stocks, life insurance, jewelry, furniture, and owed debts.
Detailed explanation-3: -These deductible expenses include accounting fees to prepare your final income tax return, income tax returns for your estate or trust, and your estate tax return, if necessary. They also include attorney fees, executor fees, trustee fees, and probate costs necessary to administer your property and affairs.
Detailed explanation-4: -If a cash-basis taxpayer dies, only expenses actually paid up to the date of death are deductible on the decedent’s final return ( ¶180).
Detailed explanation-5: -For individual wage-earners, some of the most commonly-used deductibles are mortgage interest payments, state and local tax payments, and charitable deductions.