Hello again M-MTax,
I thought I was set and had the form figured out, but I am now confused by one specific part.
As I read through the instructions for Form 709....
Under Part II—Tax Computation (Page 1 of Form 709)
and Pertaining to line 7
The instructions say...
The applicable credit (formerly unified credit) amount is the tentative tax on the applicable exclusion amount. For gifts made in 2024, the applicable exclusion amount equals:
• The basic exclusion amount of $13,610,000, PLUS
• Any DSUE amount, PLUS
• Any Restored Exclusion Amount.
It then says....
Determine the tentative tax on the applicable exclusion amount using the rates in the Table for Computing Gift Tax, and enter the result on line 7.
My question/confusion is ... Do I put the basic exclusion amount of $13,610,000 on Line 7
OR
do I put (from the Table for Computing Gift Tax) the amount based on taking Column A ($1,000,000) and then add together the tax (on that Column A amount) of $345,800 (from Column C) PLUS the 40% (from Column D) on the additional 12,610,000 ...which would be $5,044,000???
I originally thought I should put the $13,610,000 amount, but now I'm wondering why they said to use the Table for Computing Gift Tax??
Any thoughts on this??
