American College Exam HS330 Topic 1 Question 18 Discussion

Which of the following statements concerning federal gift, estate, and income taxes is (are) correct?

l. A taxable gift of income-producing property to a donee automatically transfers income tax liability on the gifted property to the donee.

II. Once part or all of a taxable gift is made to a trust, the property can no longer be includible in the donor gross estate.