Dylan makes $120,000 annually. The provincial tax credit in his province on charitable donations is 10%...

 

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Dylan makes $120,000 annually. The provincial tax credit in his province on charitable donations is 10% on the first $200, and 189% on amounts over $200. The federal tax credit on charitable donations is 15% on the first $200, and 29% on amounts over $200. Dylan owns a whole life insurance policy, based on his own life, with a face value of $350,000, an adjusted cost basis (ACB) of $26,000, and a cash surrender value (CSV) of $42.000. Dylan decides to assign his policy to a registered charity. Which of the following statements about the implications of the policy assignment is CORRECT? Oa) Ob) Oc) Dylan incurs no taxable policy gain and receives a tax credit (federal + provincial combined) of $7,426. Dylan incurs no taxable policy gain and receives a tax credit (federal + provincial combined) of $19,696. Dylan incurs a taxable policy gain of $16,000 and receives a tax credit (federal + provincial combined) of $7,426. Dylan incurs a taxable policy gain of $16,000 and receives a tax credit (federal + provincial combined) of $19,696. Od) 18888 Dylan makes $120,000 annually. The provincial tax credit in his province on charitable donations is 10% on the first $200, and 189% on amounts over $200. The federal tax credit on charitable donations is 15% on the first $200, and 29% on amounts over $200. Dylan owns a whole life insurance policy, based on his own life, with a face value of $350,000, an adjusted cost basis (ACB) of $26,000, and a cash surrender value (CSV) of $42.000. Dylan decides to assign his policy to a registered charity. Which of the following statements about the implications of the policy assignment is CORRECT? Oa) Ob) Oc) Dylan incurs no taxable policy gain and receives a tax credit (federal + provincial combined) of $7,426. Dylan incurs no taxable policy gain and receives a tax credit (federal + provincial combined) of $19,696. Dylan incurs a taxable policy gain of $16,000 and receives a tax credit (federal + provincial combined) of $7,426. Dylan incurs a taxable policy gain of $16,000 and receives a tax credit (federal + provincial combined) of $19,696. Od) 18888

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Answer Solution If Dylan assigns the policy to the registered ch... View the full answer