What are amounts taken out of the gross estate called?

• A. Deductions
• B. Net estate
• C. Unified credit
• D. Portable

Answer: (A)

In estate tax terms, the amount subtracted from the gross estate to arrive at the value used for tax calculations is called deductions. Deductions include things like funeral and administration expenses, debts of the decedent, and charitable bequests, as well as the unlimited marital deduction. After subtracting these deductions from the gross estate, you get the taxable estate (often referred to as the net estate in practice, but the formal step is the deduction from gross to taxable). The unified credit and portability are separate concepts that reduce the tax owed or extend unused exemptions, not amounts taken out of the gross estate. For example, if the gross estate is $2,000,000 and deductions total $600,000, the taxable estate would be $1,400,000.