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8.In which, if any, of the following independent situations has Ted made a gift?a.Ted purchases a U.S. savings bond listing ownership as follows: “Ted, payable to Sue on Ted’s death.”b.Ted dies owning a U.S. savings bond with ownership listed as: “Ted, payable to Sue on Ted’s death.” Sue redeems the bond.c.Ted sends $25,000 to Alice’s oral surgeon in payment of her dental implants. Alice is Ted’s sister and does not qualify as his dependent.d.Ted pays Grace $800,000 in settlement of her marital rights. One month later Ted and Grace are divorced.e.None of the above.ANS: EChoice a. is not a complete transfer. Choice b. is not a gift but is a testamentary transfer. Payment was made directly to the provider of another’s medical expenses and is, therefore, not a gift (choice c.). Section 2516 treats property settlements incident to divorce as being for full and adequate consideration (choice d.).PTS:1REF:p. 27-119.Before his nephew (Dean) leaves for college, Will loans him $400,000. Dean signs a note promising to repay the loan in five years. No interest element is provided. Which, if any, of the following is nota tax consequence of this arrangement?10.Which of the following statements relating to the Federal gift tax is incorrect?
PTS:1REF:p. 27-13 | p. 27-15 | Example 21 | Example 24