Which of the Following Transactions Constitutes a Completed Gift Made

question 40

Multiple Choice

Which of the following transactions constitutes a completed gift made by Ellen, a widow, in the current year?

• A)Ellen deposits $100,000 cash and Matt deposits $5,000 cash into a joint savings account. Matt does not withdraw anything during the current year.
• B)Ellen names Larry the beneficiary of a $100,000 life insurance policy on Ellen's life. The beneficiary designation is revocable.
• C)Ellen transfers property to a revocable trust, naming the bank as trustee. The trustee must pay out all the income to Ed over Ed's lifetime, beginning next year.
• D)Ellen reimburses her granddaughter $15,000 for her tuition at medical school.

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Definitions:

Implied Warranty

A legal guarantee implied by law that ensures goods or services sold are of satisfactory quality and fit for their intended purpose.

Insurer

An entity that provides insurance, promising to cover a specific set of risks in exchange for a premium.

Implied Warranty

A legal guarantee that the product sold will be of satisfactory quality and fit for purpose, even if not explicitly stated.

Possession

The state of having in one's control or owning something.