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If the amount of federal estate tax due on an estate valued at $ 1.35

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If the amount of federal estate tax due on an estate valued at $ 1.35  [#permalink]

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New post 25 Jul 2017, 11:24
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If the amount of federal estate tax due on an estate valued at $ 1.35 million is $ 437,000 plus 43 percent of the value of the estate in excess of $ 1.25 million, then the federal tax due is approximately what percent of the value of the estate?

A. 30%

B. 35%

C. 40%

D. 45%

E. 50%

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If the amount of federal estate tax due on an estate valued at $ 1.35  [#permalink]

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New post 25 Jul 2017, 17:45
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carcass wrote:
If the amount of federal estate tax due on an estate valued at $ 1.35 million is $ 437,000 plus 43 percent of the value of the estate in excess of $ 1.25 million, then the federal tax due is approximately what percent of the value of the estate?

A. 30%

B. 35%

C. 40%

D. 45%

E. 50%

An estate worth $1,350,000 is subject to two tax assessments:

1) one for a flat $437,000 (paid no matter what), and

2) another for 43 percent of any amount of estate value that exceeds $1,250,000
-- This estate's value exceeds the cutoff by $100,000:
\(($1,350,000 - 1,250,000) = $100,000\)
-- A 43% tax is DUE on the excess $100,000 = $43,000

#1 + #2 = total tax due
$437,000 + $43,000 = $480,000 total tax due

Tax due as a percent of the value of the estate (get rid of four zeros):

\(\frac{TotalTaxes}{Estate Value}=(\frac{48}{135}*100)\approx(.35*100)\)

is approximately 35%

Answer B
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Re: If the amount of federal estate tax due on an estate valued at $ 1.35  [#permalink]

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New post 09 Aug 2017, 13:31
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carcass wrote:
If the amount of federal estate tax due on an estate valued at $ 1.35 million is $ 437,000 plus 43 percent of the value of the estate in excess of $ 1.25 million, then the federal tax due is approximately what percent of the value of the estate?

A. 30%

B. 35%

C. 40%

D. 45%

E. 50%


Let’s determine the tax due:

437,000 + 0.43(1,350,000 - 1,250,000)

437,000 + 0.43(100,000) = 437,000 + 43,000 = 480,000

Thus, the tax due is approximately 480,000/1,350,000 = 48/135 ≈35%.

Answer: B
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Re: If the amount of federal estate tax due on an estate valued at $ 1.35  [#permalink]

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New post 12 Feb 2018, 20:30
Value of estate = \(1.35*10^6\)
Tax = \(437000+0.43(0.1*10^6)\) = \(480000\)

Percentage of tax due = \(\frac{480000}{(1.35*10^6)}*100\) ≈ \(35\)%
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Re: If the amount of federal estate tax due on an estate valued at $ 1.35  [#permalink]

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Re: If the amount of federal estate tax due on an estate valued at $ 1.35   [#permalink] 03 Mar 2019, 13:21
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