Other Taxation Topics

Question 1

Estate tax

Answer 1

tax imposed on the transfer of property at death.

part of the unified transfer tax system and takes into account transfers an individual made during lifetime and at death

Question 2

Generation-skipping tax

Answer 2

tax on the transfer of property to, or in trust for the benefit of, a persona that is two or more generations younger than the donor or transferor

designed to prevent individuals from escaping an entire generation of gift and estate taxes. imposed in addition to federal gift and estate taxes

Question 3

Gift tax

Answer 3

tax imposed on transfer of property during an individual’s lifetime

imposed upon the donor of the gift and is based upon the FMV of the property on the date of gift

Question 4

Grantor trust

Answer 4

trust over which the grantor (or spouse) retains substantial control. income is taxable to the grantor, not to the trust or beneficiaries

Question 5

Revenue ruling

Answer 5

gives the IRS’s interpretation of how the IRC and regulations apply to a specific fact situation, and therefore indicates how the IRS will treat similar transactions

Question 6

Simple trust

Answer 6

trust that is required to distribute all income to beneficiaries each year. cannot make charitable contributions and makes no distributions of the corpus

Question 7

UDITPA

Answer 7

Uniform Division of Income for TAx Purposes Act: provides rules for allocating and apportioning a multistate or multinational enterprise’s nonbusiness and business income among states and foreign counties.

Question 8

Unrelated business income

Answer 8

income of an exempt organization from a business that is regularly carried on, and is unrelated to the organization’s exempt purpose.

UBI exceeding $1,000 is subject to tax