COMPOSITION OF THE GROSS ESTATE OF A DECEDENT

Case FMV at the time of transfer of property Consideration received for transfer of property

1 P100,000 P110,000
2 P100,000 P100,000
3 P100,000 P90,000
4 P100,000 0
5 P100,000 P90,000
T

FMV of property at the time of death of

Inluded Value
the decedent

P120,000 0
P120,000 0
P120,000 30 000
P120,000 120 000
P80,000 0
Events

1)    Property transferred inter vivos, transferor is of advanced age and died within 3 years after the date of transfer.

2)    Property sold for adequate and full consideration, transferor/seller died after one day because of incurable disease.

3)    Property sold for P1,000,000. The FMV of the property sold was P 1,100,000.

4)    Property transferred, transferor has the right to take back the property.

5)    Property transferred, transferor has the right to take back the property. The transferor has waived his right before he died.

6)    Property transferred, the transferee has the power to appoint or transfer to anybody the said property.

7)    Property transferred, the transferee has the power to appoint or transfer the said property as designated by the transferor.

8)    Property transferred, the transferor has the right to the income of the property transferred while he is still alive.

9)    Property donated, Donor’s tax paid. In the deed of donation, the donor expressly reserved for himself the usufruct over the property
Answer

P
O
P
P
O
P
O
P
P
 1. Cash owned by his wife before the marriage.

2. Real property inherited by Mr. Sibug during the marriage.

3. Personal property received by his wife as gift before the marriage.

4. Personal property received by Mr. Sibug as gift before the marriage.

5. Property acquired by Mr. Sibug using his cash owned before the marriage.

6. Clothes of Mr. Sibug purchased with his wife’s exclusive money.

7. Jewelry purchased with the exclusive cash of the surviving spouse.

8. Jewelry inherited during the marriage by the surviving spouse.

9. Jewelry inherited before the marriage by the surviving spouse.

10. Unidentified property.

11. Cash representing the income earned during the marriage from the exclusive
property of Mr. Sibug.

12. Cash representing the income earned during the marriage from the common
property of the spouses.

Total
 EXCL-CPG CONJ-CPG

P2,000,000

6,000,000 P

400,000

2,000,000 P

600,000 P

500,000

1,000,000

1,000,000

1,000,000

1,200,000 P

2,000,000 P

2,000,000 P

8 600 000 5 200 000

EXCL-ACP COMM-ACP

8 500 000 10 200 000

 Resident /Citizen

House and lot, USA, FMV, time of death P4,000,0000, cost,

4 000 000
P2.000,000

House and lot, Philippines, FMV, time of death, P2,500,000;

2 500 000
Value per tax declaration, time of death, P2,000,000

Furniture and appliances, Philippines, Pawn value time of death,

1 500 000
P500,000
Car, Japan, purchase price, P1,800,000
1 8000 000

Preference Shares, Philippines, sold for P300,000 1 day before

death, FMV, date of sale, P250,000 Par value, date of death,
P350,000 (Reason of death, car accident).

Bonds, issued by a Philippine Corporation, cost, P450,000; 450 000

Ordinary shares of stock, issued by a foreign corporation, 80% of

the business is located in the Philippines, par value, time of death, 600 000
P500,000; book value, time of death, P600,000

Proceeds of life insurance, Philippines (the estate is the designated

1 800 000
beneficiary) , P1,800,000

Total 12 650 000

NRA-No Reciprocity NRA-With Reciprocity

2 500 000 2 500 000

1 500 000 1 500 000

450 000

1 800 000

6 250 000 4 000 000

 FAMILY HOME EXERCISE
1) Proceeds of life insurance, daughter of the insured was irrevocably designated as the beneficiary of the life
insurance.

2) Proceeds of life insurance, wife of the insured was revocably designated as the beneficiary of the life insurance.

3) Proceeds of life insurance, the beneficiary’s designation was not stated in the insurance policy.

4) Proceeds of life insurance, the administrator of the estate was revocably designated as beneficiary of the life
insurance.

5) Proceeds of life insurance, the executor of the estate was irrevocably designated as beneficiary of the life
insurance.

6) Benefits received from SSS, beneficiary was irrevocably designated as beneficiary.

7) Benefits from GSIS, beneficiary was revocably designated as beneficiary.

8) Proceeds of life insurance, the estate was designated as beneficiary of it.

9) Proceeds of life insurance from group insurance.

Not Included

Included

Included

Included

Included

Not Included

Not Included

Included

Not Included
 H. DEDUCTIO
1. Compute the vanishing deduction allowed to be deducted from the estate of Ms.Shing
FMV of Prior and Present, whichever is lower.

FMV 750,000.00
paid mortgage 50,000.00
700,000.00
Less: 100,000.00
600,000.00
40%
240,000.00

2. Compute the vanishing deduction allowed to be deducted from the estate of Ms.Shing, assuming the unpaid mortgage is no

₱233,333.00

I. SPECIAL D
Deductible Amount
1. Exclusive family home 8,000,000
2. Exclusive family home 10,000,000
3. Common family home 6,000,000
4. Common family home 10,000,000
5. Exclusive family home (decedent is single) 0
6. Exclusive House 4,000,000
Common House 4,000,000

J. OTHER DEDUCTIONS
1. How much is the Philippine Gross Estate?
Car, Philippines 1,000,000
Bonds, Philippines 1,000,000
Cash Deposit, Manila 1,200,000
Other tangible personal properties, Manila 500,000
Franchise, Philippines 2,500,000
Claims againtst insolvent 100,000
Philippine Gross Estate 6,300,000
 H. DEDUCTIONS AMPLIFIED
e of Ms.Shing
chever is lower.

e of Ms.Shing, assuming the unpaid mortgage is not yet included in the total losses, indebtedness, taxes, etc.(LITE) and transfer for public

I. SPECIAL DEDUCTIONS

J. OTHER DEDUCTIONS
2. How much is the total allowable deductions?
LITE 650,000 6,300,000
11,100,000
368918.918918919

TFPU 100,000

VD
(LITE) and transfer for public purpose

3. How much is the taxable net estate in the Philippines?

 M. TAX CREDIT FOR ESTATE TAX PAID TO A FOREIGN COUNTRY

1. How much is the allowable estate tax credit?

300,000 3,000,000 180,000 18000
300,000 3,000,000 180,000 18000
limit A 36000 versus limit B
Answer: 30,000

2. . Assuming that the net estate in Singapore is P400,000 and estate tax paid was 6,000, How much is the allowable estate tax
300,000 3,500,000 210,000 18000 vs 32,000
300,000 3,500,000 210,000 18000 vs 20,000
400,000 3,500,000 210,000 24000 vs 6,000

Answer: 42,000 Limit A 42,000

Limit B 60,000

3. Assuming that all foreign net assets are located in only one foreign country and foreign estate tax paid was P80,000, How m

500,000 3,000,000 180,000 30000 versus 80,000

Answer: 30,000
GN COUNTRY

30,000

much is the allowable estate tax credit?

te tax paid was P80,000, How much is the allowable estate tax credit?