ExpertMedium1 markMultiple Choice
CPA · Question 60 · Area 4: Entity Taxation
In Year 1, a married couple (US citizens) gives ,000 cash to their son. They elect gift splitting. The annual exclusion is ,000 per donee. What is the taxable gift amount for the couple combined?
In Year 1, a married couple (US citizens) gives ,000 cash to their son. They elect gift splitting. The annual exclusion is ,000 per donee. What is the taxable gift amount for the couple combined?
Answer options:
A.
0
B.
,000
C.
,000
D.
,000
How to approach this question
1. Split the gift (50/50). 2. Subtract Annual Exclusion (,000) from EACH half. 3. Sum the remainders.
Full Answer
C.,000✓ Correct
,000
With gift splitting, the ,000 gift is treated as ,000 from each spouse. Each spouse deducts the ,000 annual exclusion. ,000 - ,000 = ,000 taxable gift each. Total ,000.
Common mistakes
Applying only one exclusion to the total amount.
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