the annual exclusion was $11,000.

56. [LO 3] Casey gave $500,000 of stock to both Stephanie and Linda in 2005, 2006, and 2007. Calculate the amount of gift tax due and the marginal gift tax rate on the next $1 of taxable transfers under the following conditions.

a. In 2005 the annual exclusion was $11,000. Casey was not married and has never made any other gifts.

b. In 2006 the annual exclusion was $12,000. Casey was not married and the 2005 gift was the only other gift he has made.

c. In 2007 the annual exclusion was $12,000. Casey was married prior to the date of the gift. He and his spouse Helen live in a common law state and have elected to gift-split. Helen has never made a taxable gift, and Casey’s only other taxable gifts were the gifts in 2005 and 2006.