Assignment: TAX-665 ESTATE & GIFT TAXATION
You are an associate in a boutique tax consulting firm that specializes in the real estate industry. You have been assigned to work with a client who needs advice on the tax implications of his business holdings, which include Skyscrapers, a commercial real estate firm organized as a sole proprietorship with a fair market value of $1 billion. He is considering transferring partial ownership of the Skyscrapers to both of his children and selling a 10% interest to an unrelated third party.
Your manager has asked that you prepare a memorandum informing management of the estate and gift tax consequences of these potential transactions in addition to a cost-benefit analysis. Be sure to cite appropriate case law, statutes, and regulations in your memorandum.
Propose basic estate planning strategy (without considering trusts) applying the final project fact pattern. Consider valuation, family limited partnerships, unified credit, and annual exclusion to accomplish long-term minimization of the client's tax liability. Cite relevant legal authority for your answer. This milestone covers Section I Parts A and B (excluding trusts).
Specifically, the following critical elements must be addressed:
I. Introduction
A. Create an estate planning strategy, showing versatility of thought, that will minimize estate and gift tax liability over the course of the client's life span, potentially another 30 years. Assure that as little future tax liability as possible accrues to his children.
B. Utilize family limited partnerships to accomplish long-term minimization of the client's tax liability. Consider the mechanics of these estate planning vehicles and the appropriate authority to cite.
Format your assignment according to the following formatting requirements:
1. The answer should be typed, double spaced, using Times New Roman font (size 12), with one-inch margins on all sides.
2. The response also include a cover page containing the title of the assignment, the student's name, the course title, and the date. The cover page is not included in the required page length.
3. Also Include a reference page. The Citations and references should follow APA format. The reference page is not included in the required page length.