Which of the Following Statements Regarding the Taxation of a Trust

question 101

Multiple Choice

Which of the following statements regarding the taxation of a trust is incorrect?

• A)An irrevocable trust's income is taxed to the grantor.
• B)Trusts are generally not taxed at favorable rates for income shifting.
• C)Trusts are not subject to double taxation.
• D)A trust's long-term capital gains are taxed at a top rate of 15%.

---

Definitions:

Structure And Organization

Refers to the orderly arrangement and systematic coordination of parts, elements, or constituents within a system or entity.

Frank Sulloway

A psychologist known for his work on birth order and its effect on personality and behavior.

Firstborns

Individuals who are the oldest children in their families, often considered to have unique psychological traits and developmental experiences.

Open To Experience

A personality trait characterized by a willingness to try new activities, indulge in imaginative and intellectual pursuits, and embrace novel ideas.