Common use of Federal Gift and Estate Taxes Clause in Contracts

Federal Gift and Estate Taxes. The purchase of a Nevada Prepaid Tuition contract may constitute a gift from the purchaser to the beneficiary. Contributions to a 529 Plan, excluding those from an Uniform Gifts to Minors Act (UGMA) or Uniform Transfers to Minor Act (UTMA) account, are generally considered to be completed gifts to the designated beneficiary and may qualify for the $13,000/$26,000 (single taxpayer/taxpayers filing jointly) annual gift and generation skipping transfer tax exclusions for calendar year 2010. In cases where contributions to a 529 Plan such as the Nevada Prepaid Tuition Program exceed the then current UGMA/UTMA annual gift limits, a purchaser may elect to treat the contributions as if they were made ratably over a five-year period. This election, which is made on the taxpayer’s gift tax return, is applicable only for contributions up to five times the available annual exclusion in the calendar year of the contribution. Thus, for calendar year 2010, the maximum contribution pursuant to this rule would be $65,000 (or $130,000 for a married couple). Estate, gift, and generation-skipping tax issues arising in conjunction with 529 Plans are complex. Potential purchasers and beneficiaries should consult a tax advisor for advice on their individual tax situation. State Income Tax Nevada does not have a state income tax. Potential purchasers who are not residents of the State of Nevada, but are qualified purchasers may want to first consult a tax advisor. Hope Scholarship and Lifetime Learning Tax Credits The use of Education Tax Credits will not affect participation in the Program. However, a purchaser cannot claim Hope Scholarship or Lifetime Learning Tax Credits for amounts withdrawn tax free under a Program contract. Please be aware that the coordination of the various federal higher education tax incentives can be complex. A purchaser or potential purchaser should contact a tax professional or the IRS for assistance in determining eligibility for the various tax incentives and in allocating higher education expenses.

Federal Gift and Estate Taxes. The purchase of a Nevada Prepaid Tuition contract may constitute a gift from the purchaser to the beneficiary. Contributions to a 529 Plan, excluding those from an Uniform Gifts to Minors Act (UGMA) or Uniform Transfers to Minor Act (UTMA) account, are generally considered to be completed gifts to the designated beneficiary and may qualify for the $13,000/$26,000 (single taxpayer/taxpayers filing jointly) annual gift and generation skipping transfer tax exclusions for calendar year 20102009. In cases where contributions to a 529 Plan such as the Nevada Prepaid Tuition Program exceed the then current UGMA/UTMA annual gift limits, a purchaser may elect to treat the contributions as if they were made ratably over a five-year period. This election, which is made on the taxpayer’s gift tax return, is applicable only for contributions up to five times the available annual exclusion in the calendar year of the contribution. Thus, for calendar year 20102009, the maximum contribution pursuant to this rule would be $65,000 (or $130,000 for a married couple). Estate, gift, and generation-skipping tax issues arising in conjunction with 529 Plans are complex. Potential purchasers and beneficiaries should consult a tax advisor for advice on their individual tax situation. State Income Tax Nevada does not have a state income tax. Potential purchasers who are not residents of the State of Nevada, but are qualified purchasers may want to first consult a tax advisor. Hope Scholarship and Lifetime Learning Tax Credits The use of Education Tax Credits will not affect participation in the Program. However, a purchaser cannot claim Hope Scholarship or Lifetime Learning Tax Credits for amounts withdrawn tax free under a Program contract. Please be aware that the coordination of the various federal higher education tax incentives can be complex. A purchaser or potential purchaser should contact a tax professional or the IRS for assistance in determining eligibility for the various tax incentives and in allocating higher education expenses.

Federal Gift and Estate Taxes. The purchase of a Nevada Prepaid Tuition contract may constitute a gift from the purchaser to the beneficiary. Contributions to a 529 Planplan, excluding those from an a Uniform Gifts to Minors Act (UGMA) or Uniform Transfers to Minor Act (UTMA) account, are generally considered to be completed gifts to the designated beneficiary Beneficiary and may qualify for the $13,000/$26,000 15,000/$30,000 (single taxpayer/taxpayers filing jointly) annual gift and generation skipping transfer tax exclusions for calendar year 2010exclusion. In cases where contributions to a 529 Plan such as the Nevada Prepaid Tuition Program exceed the then current UGMA/UTMA annual gift limits, a purchaser Purchaser may elect to treat the contributions as if they were made ratably over a five-year period. This election, which is made on the taxpayer’s gift tax returnIRS Form 709, is applicable only for contributions up to five times the available annual exclusion in the calendar year of the contribution. Thus, for calendar year 2010, the maximum contribution pursuant to this rule would be $65,000 75,000 (or $130,000 150,000 for a married couple)) in 2020. Estate, gift, and generation-skipping tax issues arising in conjunction with 529 Plans plans are complex. Potential purchasers Purchasers and beneficiaries Beneficiaries should consult a their own tax advisor for advice on their individual tax situationsituation and to identify any annual gift limit increases. State Income Tax Nevada does not have a state income tax. Potential purchasers Purchasers who are not residents of the State of Nevada, Nevada but are qualified purchasers Purchasers may want to first consult a their own tax advisor. Hope Scholarship American Opportunity and Lifetime Learning Tax Credits The use of Education Tax Credits will not affect participation in the Program. However, a purchaser Purchaser cannot claim Hope Scholarship the American Opportunity Tax Credit or Lifetime Learning Tax Credits for amounts withdrawn tax free under a Program contractContract. Please be aware that the coordination of the various federal higher education tax incentives can be complex. A purchaser Purchaser or potential purchaser Purchaser should contact a their own tax professional or the IRS Internal Revenue Service for assistance in determining eligibility for the various tax incentives and in allocating higher education expenses. For more information, refer to IRS Publication 970, "Tax Benefits for Education," which is available at xxx.xxx.xxx.

Federal Gift and Estate Taxes. The purchase of a Nevada Prepaid Tuition contract may constitute a gift from the purchaser to the beneficiary. Contributions to a 529 Planplan, excluding those from an a Uniform Gifts to Minors Act (UGMA) or Uniform Transfers to Minor Act (UTMA) account, are generally considered to be completed gifts to the designated beneficiary Beneficiary and may qualify for the $13,000/$26,000 15,000/$30,000 (single taxpayer/taxpayers filing jointly) annual gift and generation skipping transfer tax exclusions for calendar year 2010exclusion in 2018. In cases where contributions to a 529 Plan such as the Nevada Prepaid Tuition Program exceed the then current UGMA/UTMA annual gift limits, a purchaser Purchaser may elect to treat the contributions as if they were made ratably over a five-year period. This election, which is made on IRS Form 709, the taxpayer’s 's gift tax return, is applicable only for contributions up to five times the available annual exclusion in the calendar year of the contribution. Thus, for calendar year 2010, the maximum contribution pursuant to this rule would be $65,000 75,000 (or $130,000 150,000 for a married couple)) in 2018. Estate, gift, and generation-generation- skipping tax issues arising in conjunction with 529 Plans plans are complex. Potential purchasers Purchasers and beneficiaries Beneficiaries should consult a their own tax advisor for advice on their individual tax situationsituation and to identify annual gift limit increases. State Income Tax Nevada does not have a state income tax. Potential purchasers Purchasers who are not residents of the State of Nevada, but are qualified purchasers Purchasers may want to first consult a their own tax advisor. Hope Scholarship American Opportunity and Lifetime Learning Tax Credits The use of Education Tax Credits will not affect participation in the Program. However, a purchaser Purchaser cannot claim Hope Scholarship the American Opportunity Tax Credit or Lifetime Learning Tax Credits for amounts withdrawn tax free under a Program contractContract. Please be aware that the coordination of the various federal higher education tax incentives can be complex. A purchaser Purchaser or potential purchaser Purchaser should contact a their own tax professional or the IRS Internal Revenue Service for assistance in determining eligibility for the various tax incentives and in allocating higher education expenses. For more information, refer to IRS Publication 970, "Tax Benefits for Education," which is available at xxx.xxx.xxx.