At her death Emily owned real estate worth $2.5 million and other property worth $1 million. Property taxes of $200,000 were accrued on the real estate at the time of Emily's death. Which of the following is a true statement?

Question

Quizplus · Accepted Answer

Emily's gross estate is the sum of the value of her real estate and other property, which equals $3.5 million ($2.5 million + $1 million). However, property taxes are deductible from the gross estate, so her adjusted gross estate is $3.3 million ($3.5 million - $200,000). The taxable estate is determined after allowable deductions, such as funeral expenses and debts, are subtracted from the adjusted gross estate. The estate tax base is the same as the taxable estate. However, this information is not provided in the question, so choices B and D cannot be determined. Therefore, the correct answer is C.

At Her Death Emily Owned Real Estate Worth $2