Exam 12: The Gift Tax

In 2018, Letty makes taxable gifts totaling $4 million. Her only other taxable gifts amount to $1 million, all of which were made in 2012. What is Letty's 2018 gift tax liability before the unified credit?

Identify which of the following statements is true.

A split-interest gift transfer

Roger makes a $1,000,000 cash gift on January 1 of the current year, and dies on February 1 of the current year. Roger's gift tax return is due

Identify which of the following statements is true.

Discuss the statutory exemptions from the gift tax.

Identify which of the following statements is false.

Which of the following statements is true?

A gift-splitting election

Identify which of the following statements is false.

Karen purchased a beach house for $300,000 and immediately titled it in the names of Karen and Kenny, as joint tenants with right of survivorship. Karen and Kenny are not married. Did a gift occur? If so, for what amount?

Identify which of the following statements is true.

Molly sells her car, valued at $30,000, to her nephew Todd for $18,000. Molly has made a taxable gift.

Identify which of the following statements is false.

Jack transfers property worth $250,000 to a revocable trust on January 1. Two-and-a-half years later, when the property is worth $300,000, the trust becomes irrevocable. Which of the following statements is correct?

Identify which of the following statements is true.

A Sec. "2503(c) trust"

A "Crummey demand power" in a trust document allows the donor to demand a distribution from the trust in years in which earnings exist within the trust.

In the current year, Bonnie, who is single, sells stock valued at $60,000 to Linda for $15,000. Later that year, Bonnie gives Linda $25,000 in cash. Bonnie's taxable gifts from these transfers total

Marilyn and Earl establish a trust benefiting their grandchild, Courtney, age 4. Courtney is to receive the accumulated income and corpus when she reaches age 30. In the year of the transfer, Courtney has a two-week period in which to request distributions. This trust is a