Classify Each of the Following Statements

question 124

Multiple Choice

Classify each of the following statements:
-Under a prenuptial agreement, Herbert transfers stock to Norma. One month later, Herbert and Norma are married.

• A)No taxable transfer occurs.
• B)Gift tax applies.
• C)Estate tax applies.

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Definitions:

Accounting Forms

Documents used for recording financial transactions and maintaining accounting records.

Payee

A person who receives a payment.

Third-Party Check

A check made out to one recipient and given in payment to another, as with one made out to a patient rather than the medical practice.

Health Insurance Company

A firm that offers plans and policies that cover the costs of medical care, including treatments, surgeries, and sometimes prescription drugs.