Pedro bourbone is the founder and owner of a highly

Assignment Help Accounting Basics

Reference no: EM13585966

Pedro Bourbone is the founder and owner of a highly successful small business and, over the past several years, has accumulated a significant amount of personal wealth. His portfolio of stocks and bonds is worth nearly $5,000,000 and generates income from dividends and interest of nearly $250,000 per year. With his salary from the business and his dividends and interest, Pedro has taxable income of approximately $600,000 per year and is clearly in the top individual marginal tax bracket. Pedro is married and has three children, ages 16, 14, and 12. Neither his wife nor his children are employed and have no income. Pedro has come to you as his CPA to discuss ways to reduce his individual tax liability as well as to discuss the potential estate tax upon his death. You mention the possibility of making gifts each year to his children. Explain how annual gifts to his children will reduce both his income during lifetime and his estate tax at death.

Image text transcribed for accessibility Pedro Bourbone is the founder and owner of a highly successful small business and, over the past several years, has accumulated a significant amount of personal wealth. His portfolio of stocks and bonds is worth nearly $5,000,000 and generates income from dividends and interest of nearly $250,000 per year. With his salary from the business and his dividends and interest, Pedro has taxable income of approximately $600,000 per year and is clearly in the top individual marginal tax bracket. Pedro is married and has three children, ages 16, 14, and 12. Neither his wife nor his children are employed and have no income. Pedro has come to you as his CPA to discuss ways to reduce his individual tax liability as well as to discuss the potential estate tax upon his death. You mention the possibility of making gifts each year to his children. Explain how annual gifts to his children will reduce both his income during lifetime and his estate tax at death.

Reference no: EM13585966

Questions Cloud

Mvies galore distributes dvds to movie retailersincluding : movies galore distributes dvds to movie retailersincluding dot.coms.movies galores top management meets monthly to

Determine the amount of overhead allocated to the wool : american fabrics has budgeted overhead costs of 997920. it has allocated overhead on a plantwide basis to its two

Give a complete specific mechanism for the formation of the : give a complete specific mechanism for the formation of the ester ethyl 2-phenyl

Differentiate between humoral and cell mediated responses : 1. why do you think specificity heterogeneity diversity memory and self-vs.nbsp oneself recognition is vital to the

Pedro bourbone is the founder and owner of a highly : pedro bourbone is the founder and owner of a highly successful small business and over the past several years has

Total estimated overhead costs are 298800 overhead cost : wilkins inc. has two types of handbags standard and custom. the controller has decided to use a plantwide overhead rate

Conan obrien logging and lumber company owns 3300 acres of : conan obrien logging and lumber company owns 3300 acres of timberland on the north side of mount leno which was

What are different types of separating techniques for : what are different types of separating techniques for separating salt and

Calculate the total overhead cost to be applied to each : the splash makes large fiberglass swimming pools and uses machine hours and direct labor hours to apply overhead in the

User Account

All Pages