Which term describes a combined gift tax and estate tax?

• A. Unified gift and estate tax
• B. Taxable estate
• C. Portable
• D. Net estate

Answer: (A)

The main concept is that the federal gift and estate taxes are integrated under a single transfer tax framework, described as the unified gift and estate tax. Under this system, gifts you give during life and assets you pass at death share one exemption amount and one set of tax rates. Using part of your lifetime gift exemption reduces the amount available to shield the estate at death, and the same rate structure applies to both kinds of transfers. Portable is a related feature about allowing a surviving spouse to use any unused portion of the deceased spouse’s exemption, but it describes a specific provision rather than the overall unified system. Net estate and taxable estate are measures within this framework—net estate is the value after debts, while taxable estate is the portion subject to tax after deductions and the exemption. The unified approach—one framework, one set of rates, one exemption—best describes the combined gift and estate tax.