On September 1, George Transfers His Entire Ownership Rights in a $250,000

question 95

Essay

On September 1, George transfers his entire ownership rights in a $250,000 life insurance policy on his own life to his sister, Sally. The policy's interpolated terminal reserve is $30,000 as of September 1. On July 1, George had paid the policy's $6,000 annual premium. On July 1 of the subsequent year, George again paid the premium on the policy. What are the gift tax consequences in the subsequent year, if any?

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Definitions:

Cultural Diversity

The existence of a variety of cultural or ethnic groups within a society.

Racial Equality

The principle that individuals should not be discriminated against based on their race and should have equal rights and opportunities.

Eighteenth Century

The period from January 1, 1701, to December 31, 1800, in the Gregorian calendar, marking the 18th century.

Ethnic Differences

The distinctions and diversities that exist among various ethnic groups, often pertaining to culture, language, or identity.