Alfred Is a Consultant for Data Planners

question 28

Multiple Choice

Alfred is a consultant for Data Planners. In an effort to minimize his tax liability he enters into a legal contract transferring 25% of the fees from a new consulting contract to his son Ken, who is 42, and owns a pest control business. Which of the following statements concerning the transaction is correct?
I.The assignment-of-income doctrine prevents Alfred from transferring taxation of the income to his son.
II.The assignment-of- income doctrine does not apply because the transfer is supported by a legal contract.
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• A)Only statement I is correct.
• B)Only statement II is correct.
• C)Both statements are correct
• D)Neither statement is correct.

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Definitions:

Cemetery Plot

A specific piece of land within a cemetery assigned for the burial of the dead.

Organ Donation

The act of giving one's organs or tissue for transplantation into another person after death or while alive.

Body Project

The endeavor, often influenced by societal and cultural norms, to shape or modify one's physical appearance through exercise, diet, cosmetic procedures, or other means.

Redesign

The process of revising and improving upon the design of an existing object, system, or service.