The Generation-Skipping Tax Is Designed to Accomplish Which of the Following

question 34

Multiple Choice

The generation-skipping tax is designed to accomplish which of the following?

• A)Generate additional revenues to supplement the estate tax.
• B)Prevent the avoidance of transfer taxes (both estate and gift tax)through transfers that skip a generation of recipients.
• C)Eliminate the possibility that the estate tax can be avoided by gifts in contemplation of death.
• D)Replace the gift tax on distributions from trusts.
• E)None of the choices are correct.

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Definitions:

Quotas

Restrictions set by governments on the quantity or value of goods that can be imported or exported, used to control trade balances and protect domestic industries.

Infant Industry

A new industry that is in its early stages of development and may be protected or supported by government policies.

Protection

Economic policies and actions, such as tariffs and quotas, taken by a government to shield domestic industries from foreign competition.

Compete

The act of striving against others for the purpose of achieving goals such as winning a market share, receiving recognition, or obtaining a scarce resource.