Which statement is not correct? a. Related-party income is taxable b. Related-party losses are non-deductible c. Grantor and fiduciary of a trust are related parties d. None of the above
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- Which of the following is usually not accounted for as an adjustment to a trust's income? Multiple Choice Lease cancellation fees. Rent expense. Investment costs and commissions. Insurance expense. Property taxes.Which of the following is a characteristic of a fixed trust? Select one:The trustee usually has discretion as to the timing of the distribution.Beneficiaries can compel payment of amounts to which they are presently entitled.All of the above are characteristics of fixed trusts.If the trustee has determined to distribute income to a beneficiary, actual receipt of that income is not required for it to be assessable for income tax purposes.None of theseA grantor is disallowed from doing which of the following in a grantor trust? Avoiding taxation until the trust is revoked. Controlling the disposition of trust property. Distributing current income to the grantor or grantor's spouse. Revoking or modifying the trust.
- The rules on holding period shall only apply where the taxpayer is an individualand the dealing pertains to capital assets. a.true b.falseGains and losses derived from sale or exchange of ordinary assets are included in the computation of taxable income, subject to holding period in case of individuals. TRUE OR FALSE?Which of the following items affect taxable income? Select one or more: a. Realized Gains and Losses b. Unrealized Gains and Losses c. Interest Income PreviousSave AnswersFinish attempt ...
- Which is incorrect statement regarding the taxability or deductibility of gains or losses in dealings in property: Ordinary gain is taxable in full Ordinary loss is deductible in full Net capital gain is taxable in full Net capital loss is deductible in fullWhich of the following causes a temporary difference between taxable and pretax accounting income? A. Investment expenses incurred to generate tax-exempt income. B. MACRS used for depreciating equipment. C. The dividends received deduction. D. Life insurance proceeds received due to the death of an executive.One of the following is not a prerequisite in order that claim against the estate maybe deductible They must be existing against the estate They must be reasonably certain as to amounts They must have been prescribed They must be enforced by the claimants
- Which of the following is not true of the netting process for capital gains and losses? Group of answer choices 1.If a taxpayer has both a NSTCG and a NLTCG or both a NSTCL and a NLTCL, the results are netted in the second stage of the netting process. 2.Long-term capital gains and losses are combined and result in either a net long-term capital gain (NLTCG) or a net long-term capital loss (NLTCL). 3.Short-term capital gains and losses are combined and result in either a net short-term capital gain (NSTCG) or a net short-term capital loss (NSTCL). 4.If a taxpayer has either an NSTCG and an NLTCL or NSTCL and an NLTCG, the results are netted in the second stage of the netting process.Which of the following are nontax characteristics of a qualified terminable interest property (QTIP) trust? The income may go to multiple beneficiaries. The donor or decedent's executor qualifies the trust assets for the marital deduction by making a timely election The principal of the trust is paid to the surviving spouse's estate if the election to qualify the assets for the marital deduction was not made upon creation of the trust. The grantor of the trust determines who receives the remainder interest in the trust assets. A)II, III, and IV B)I and III C)IV only D)II and IVWhen the temporary differences result to financial income higher than taxable income, they are known as taxable temporary difference or future deductible amounts. a. TRUE b. FALSE
