Question content area top Part 1 Determine whether the following statement is true or false: Every donor who makes a taxable gift incurs a gift tax liability. Explain your answer.

A.

False. The unified credit affects the estate tax, not the gift tax burden.

B.

False. Due to the unified credit, relatively large taxable gifts can be made before a gift tax liability is triggered.

C.

True. The unified credit assists in slightly lowering the gift tax burden. Only once the yearly unified credit amount is used, however.

D.

True. As donors make gifts triggering a taxable gift for the year, tax will be due for that year.