Gift Tax Self-Quiz

 

 

 

 

 

 

In 2003, Tina gave each of her three grandchildren, Avril, Samantha and Tucker, $20,000 in cash as their birthday presents. Tina paid gift tax on the excess amounts over the annual exclusion amount. The gift tax is subtracted from the gift.
True
False
In 2003, Juan gave his nephew, Gustavo, a new car (value $15,000) as a graduation gift. In addition, Juan gave his daughter, Gina, $5,000 in cash. How much did Juan give in taxable gifts?
Choice 1 For 2003, Juan gave taxable gifts of $20,000.
Choice 2 For 2003, Juan gave taxable gifts of $15,000.
Choice 3 For 2003, Juan gave taxable gifts of zero.
Choice 4 For 2003, Juan gave taxable gifts of $4,000.
In 2003, Matthew gave $11,000 in AOL Time Warner stock to his niece, Candy. He also gave $7,500 in U.S. Treasury bonds to his cousin, Grady.
Choice 1 Matthew’s taxable gifts amount for 2003 is $18,500.
Choice 2 Mathew’s taxable gifts amount for 2003 is zero.
Choice 3 Mathew’s taxable gift amount for 2003 is $11,000.
In 2003, Matthew and his wife, Simone, gave $22,000 in AOL Time Warner stock to his niece, Candy. They also gave $15,000 in U.S. Treasury bonds to his cousin, Grady. Simone gave another $15,000 to her sister, Sheila.
Choice 1 Their taxable gifts amount for 2003 is $19,000.
Choice 2 Their taxable gifts amount for 2003 is zero.
Choice 3 Their taxable gifts amount for 2003 is $52,000.
Choice 4 Their taxable gifts amount for 2003 is $4,000.
Phillip’s son, Barney, will leave for college in Massachusetts in a couple weeks. Phillip paid $55,000 to the university last month for the $35,000 tuition; the balance will cover room, board and other fees. In addition, Phillip deposited $5,000 into Barney’s new bank account to cover emergencies.
Choice 1 Phillip’s taxable gifts amount for 2003 is $60,000.
Choice 2 Phillip’s taxable gifts amount for 2003 is $14,000.
Choice 3 Phillip’s taxable gifts amount for 2003 is $25,000.
Choice 4 Phillip’s taxable gifts amount for 2003 is $5,000.
Marilyn’s sister, Mandy, broke her leg and suffered some internal injuries in a motorcycle accident. She spent three days in the hospital and had an operation to put a pin in her leg. Afterwards, she spent four weeks in physical therapy. Since Mandy did not have insurance, Marilyn gave her $32,000 to cover her medical expenses.
Choice 1 Marilyn’s taxable gift amount for 2003 is zero.
Choice 2 Marilyn’s taxable gift amount for 2003 is $32,000.
Choice 3 Marilyn’s taxable gift amount for 2003 is $21,000.
Choice 4 Marilyn’s taxable gift amount for 2003 is $11,000.
Jasmine recently emigrated to the U.S. from Canada to marry her boyfriend, Thomas. They went to Hawaii for their honeymoon. During one of their shopping trips at a local boutique, Thomas bought Jasmine a diamond and ruby pendant for $150,000. The pendant is a taxable gift.
True
False
Jordan and his wife, Antoinette, recently had their first child. To celebrate the occasion, Jordan bought his wife a brand new Volvo ($35,000) to replace their old station wagon. In addition, he bought her a diamond engagement ring for $350,000. When they married six years ago, he could not afford to buy her a substantial ring. They were high school sweethearts and still live in Orlando, where they were both born and raised. Which of the following is correct?
Choice 1 Both the Volvo and diamond engagement ring are taxable gifts.
Choice 2 The Volvo is a taxable gift.
Choice 3 The diamond engagement ring is a taxable gift.
Choice 4 Neither the Volvo nor the diamond engagement ring is a taxable gift.
Scott gave $12,000 to his alma mater for a special scholarship drive. In addition, during 2003, he gave $15,000 to his church. Lastly, he gave $5,000 to a local homeless shelter.
Choice 1 The $32,000 donations qualify for an exclusion from the gift tax.
Choice 2 The $12,000 donation qualifies for an exclusion from the gift tax.
Choice 3 The $15,000 donation qualifies for an exclusion from the gift tax.
Choice 4 The $5,000 donation qualifies for an exclusion from the gift tax.

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