George, a high-bracket taxpayer, wishes to shift some of his own taxable income from corporate bonds he

Question:

George, a high-bracket taxpayer, wishes to shift some of his own taxable income from corporate bonds he owns to his 25-year-old daughter, Debra, so that Debra rather than George is taxed on the interest. One alternative is to make a gift of the interest, and the other is to make a gift of the bonds themselves. Evaluate the pros and cons of each alternative.