Match Each Statement with the Correct Choice

question 22

Multiple Choice

Match each statement with the correct choice. Some choices may be used more than once or not used at all.
-Donee's basis for gain.

• A)Step-up in basis
• B)Step-down in basis
• C)Gift of installment notes receivable
• D)Gift of property that has potential for recapture of depreciation
• E)Donor's basis on date of gift appreciated property given, no gift tax due)
• F)The amount of the deceased spouse's taxable estate does not change
• G)Fair market value on date of gift
• H)Expected surviving spouse is in good health and 10 years younger
• I)No income tax consequences to the beneficiary
• J)Income in respect of a decedent IRD)
• K)No correct choice is given

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Definitions:

Marginal Tax Rate

Refers to the rate at which the next dollar of taxable income is taxed.

Tax Cuts

Reductions in the amount of taxes that individuals or corporations must pay to the government.

Proportional

Proportional describes a relationship or ratio that maintains the same relative size or aspect between items or variables.

Regressive

Refers to a tax system in which the tax rate decreases as the taxable amount increases, often placing a heavier burden on low-income earners.