Identify Which of the Following Statements Is True

question 17

Multiple Choice

Identify which of the following statements is true.

• A) An individual can inadvertently make a gift by underestimating a property's fair market value and selling it to a relative for a price below its fair market value.
• B) The statutory exemption from the gift tax for payments for medical care requires that the payment be made for a relative.
• C) A taxable gift may occur when property is sold in an arm's length transaction for less than its FMV.
• D) All of the above are false.

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Definitions:

Confidence

A feeling of self-assurance arising from an appreciation of one’s own abilities or qualities.

Mediocrity

The quality of being average or moderate in quality, not outstanding or poor.

Sincerity

The quality of being free from pretense, deceit, or hypocrisy; genuine honesty.

Appealing Traits

Characteristics or qualities that are attractive or pleasing to others, often influencing their perceptions or decisions positively.