F has a son, C, who earns a $50,000 salary and has $500 interest income. During 2022,
Question:
F has a son, C, who earns a $50,000 salary and has $500 interest income. During 2022, F loaned C $95,000 to go to medical school. Assume interest imputed at the IRS rate is $3,000. Which of the following statements is true about interest deemed earned by F or the amount of taxable gift before the annual exclusion?
| a. | F is charged with a taxable gift of $3,000 before the annual exclusion and has no interest income.
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| b. | F is charged with a taxable gift of $3,000 before the annual exclusion.
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| c. | F is charged with a taxable gift of $95,000 before the annual exclusion.
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| d. | F has no interest income and no taxable gift of $3,000 before the annual exclusion.
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| e. | F has interest income of $3,000. |
Expert Answer:
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
