Vanishing deduction is computed with the following format:
Value to take (the lower the amount of the fair market value of properties xxxx
at the time of inheritance between at the time of death of the decedent)
Less: Mortgage paid assumed (1st deduction) (xxxx)
Initial Basis xxxx
Less: Proportionate deduction (2nd deduction) (xxxx)
Initial Basis x ELITe + Transfer for Public Use = Proportionate deduction
Gross Estate
Final Basis xxxx
Multiply by Vanishing deduction rate (%) xxxx
Vanishing deduction xxxx
The vanishing deduction rates is based on the period from receipt to decedent's death as follows: (1) within 1 year-100%; (2) beyond 1 year to 2 years-80%; (3) beyond 2 years to 3 years-60%; (4) beyond 3 years to 4 years-40%; and (5) beyond 4 years to 5 years-20%.
No comments:
Post a Comment