Question

Answer each question by defining the term in your own words to demonstrate an understanding. Cite any pertinent Internal Revenue Code sections or Regulations when possible.

1. Applicable Credit Amount

2. Crummey Power

3. Unified Credit

4. Annual Exclusion

5. Net Gift

6. Disclaimer

7. Marital Deduction

Answer 1

1- Applicable Credit Amount(Formerly Unified Credit Amount)

It is applicable in gift tax and estate tax where it equates the tax on applicable amount.in other words,the credit applicable to both estate and gift is called Applicable Credit Amount

2- Crummey Power

A Crummey power is a special power of gifts, where a person receives a tax deductible gift and then he can convert that to a tax applicable gift.Crummey power was first created in the 1960s

3-Unified Credit

it is the credit amount that everyone can deduct while giving gifts to others without paying tax in relation to gift,estate,generation skipping trasnfor etc.it is applicable in America

4-Annual Exclusion

It is the amount of money that can be transfor one person to other as a form of gift without paying gift tax

5- Net Gift

practitioners are advised their client to make taxable gift the amount exceeds the excemption limit and pay taxes,where during the past 7 years the estate tax have been eliminated.

6-Disclaimers

Disclaimers are a good way to show some  specific points related to liability that fall outside your Terms & Conditions agreement

7-Marital Deduction

it is a process of giving assets by one person to their spouse to with no tax imposed.it is a special type of tax law