In Which of the Following Circumstances Will Income of the Child

question 19

Multiple Choice

In which of the following circumstances will income of the child be taxed at the rates applicable to estates and trusts?
I.Martin, age 6, earns $14,000 this year by acting in television commercials.
II.Allen, age 22 and a full time college student, has $4,000 of interest income on municipal bonds that he inherited from his grandfather last year.
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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:

Algebraic Expression

An expression that contains numbers, variables, and operations, constructed according to algebraic principles.

Verbal Phrase

A phrase that expresses an action or a state of being, often used in math to translate words into algebraic expressions.

Algebraic Expression

A mathematical phrase that can contain ordinary numbers, variables, and operators, but does not have an equals sign.

Difference

The result of subtracting one number from another.