Carl and Carol Williams,a married couple,are doing some estate planning.Upon his death,Carl plans to leave $1,000,000 in property to his wife.This amount will reduce the value of Carl's gross estate and will be taxed later when Carol dies.This reduction of the gross estate is called the

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The reduction in the gross estate through leaving property to a surviving spouse is called the marital deduction. This deduction allows for the unlimited transfer of assets from one spouse to another without incurring any estate or gift taxes. Therefore, Carl's plan to leave $1,000,000 in property to his wife will not be taxed in his estate and will not reduce the value of his gross estate for tax purposes. It will only be taxed later when Carol dies, and therefore is not referred to as the taxable estate or unified tax credit. The capital gains deduction is a separate deduction for capital gains taxes and is not related to estate planning.

Carl and Carol Williams,a Married Couple,are Doing Some Estate Planning