Which of the Following Statements About the Portability of the Unified

question 32

Multiple Choice

Which of the following statements about the portability of the unified transfer tax credit is true?

• A)When the first spouse dies, then any unused applicable exclusion amount will carry over to the other spouse.
• B)When the first spouse dies, then any unused applicable exclusion amount will carry over to the government.
• C)When the first spouse dies and is left with an excess amount after using the applicable exclusion, then the excess amount will carry over to a trust.
• D)It is a method of reducing gift taxes with the consent of the other spouse in which the gift can be treated as if each had been given one-half of it.
• E)It is a method of transferring assets between spouses, either by gift or through estate.

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Definitions:

Stock Split

A company's action to chop up its existing stock into more pieces to make the shares easier to trade.

Owners' Equity

The residual interest in the assets of a company after deducting liabilities, representing the ownership interest of shareholders in the company.