Which of the Following Statements About the Federal Gift Tax

question 67

Multiple Choice

Which of the following statements about the federal gift tax is false?

• A) The tax is imposed on the donor.
• B) The tax is based on the fair market value of the gifted property.
• C) An individual can give away $10 million (adjusted annually for inflation) every year without being subject to tax.
• D) The donor's basis in the gifted property carries over to become the donee's basis.

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Definitions:

Lower Prices

A strategy or condition where the cost of goods or services is reduced to attract customers or gain a competitive edge in the market.

Stored-value Money

A type of electronic money that is stored on a card or a digital wallet, representing a claim on a predefined amount of currency.

Gift Cards

Prepaid stored-value money cards issued by a retailer or bank, used as an alternative to cash for purchases within a particular store or related businesses.

Electronic Checks

Electronic checks, or e-checks, are a form of digital payment where money is electronically withdrawn from the payer's checking account, transferred over the ACH network, and deposited into the payee's account.