Refer to the NumberCruncher Networked Installations Help File.

If the state uses the same "taxable estate" as the federal estate tax, then the "decoupled" estate tax can be calculated in the following way:

Take the "Gross Federal Estate Tax" calculated by NumberCruncher and subtract the "applicable credit amount" that is used by the state for purposes of its death tax. (The "applicable credit amount" is the federal tax that would be imposed on an estate equal to the applicable exclusion amount." So, for example, if a state calculates its tax using an exclusion of $1 million, the "applicable credit amount" would be $345,800.)

The "decoupled" state death tax will be either (a) that excess of the "Gross Federal Estate Tax" over the state "applicable credit amount" or (b) the "Maximum Credit under §2011(b)(1)" as shown in the NumberCruncher calculation, whichever is the lesser amount.

A charitable remainder unitrust must provide a present charitable deduction of at least 10%, as required by the Taxpayer Relief Act of 1997, in order to qualify for a charitable income tax, gift tax, or estate tax deduction, but there is a disagreement among some commentators about which section 7520 rate should be used to calculate the value of the remainder for purposes of the 10% test.

I.R.C. Section 664(d)(2)(D) states that the value (determined under section 7520) of such remainder interest in such property is at least 10 percent, and section 7520(a) states that if an income, estate, or gift tax charitable contribution is allowable, then the taxpayer may elect to use the 7520 rate for either of the two preceding months, instead of the month of the gift or death. However, several commentators have suggested that the election to use a rate from a preceding month cannot be made until after the trust qualifies for the charitable deduction, and the trust does not qualify for the charitable deduction unless it first qualifies using the rate for the current month, without regard to the deduction. Although the IRS has not raised this argument, and informal discussions with the IRS National Office suggest that the IRS does not intend to raise the argument, NumberCruncher errs on the side of caution and calculates the optimized payout based on the 7520 rate for the month of the transfer, regardless of which month is selected for the actual valuation.

To over-ride this feature, and optimize for the same rate you wish to use for valuation purposes, simply change the transfer date to the date of the month in which the desired 7520 rate occurred. (But do not change a date from after 4/1999 to a date before 5/1999, because then there will be a change in mortality tables as well as interest rates.)

Tables 80CNSMT and 90CM are mortality tables derived from the 1980 and 1990 censuses. They show 100,000 live births at age 0 and the number of lives still in being (Lx) at each future age. (So, for example, you can calculate the probability of a person age 21 living to age 50 by taking the Lx for age 50 and dividing by the Lx for age 21.) Table 90CM is used in the calculation of the life estate, annuity, and remainder factors for interests created after 4/30/1999 that are valued under I.R.C. section 7520 (subject to the transitional rules found in Treas. Reg. section 20.2031-7). Table 90CM can be found in various places, including Publication 1457, "Actuarial Values: Book Aleph," and Treas. Reg. section 20.2031-7. Table 80CNSMT can be found in Treas. Reg. section 20.2031-7A, along with a Table S (single life remainder) based on Table 80CNSMT.