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Which of the Following Statements About the Tax Treatment of Gifts

Question 21

Multiple Choice

Which of the following statements about the tax treatment of gifts of capital assets is NOT correct?


A) The adjusted cost base to the recipient will be the fair market value of the asset gifted.
B) The tax treatment of gifts is different when the gift is made to a non-arm's length party rather than to an arm's length party.
C) The proceeds of disposition to the person giving the gift will be the fair market value of the asset gifted.
D) If the fair market value of the asset being given exceeds its tax cost to the person giving the gift, that person will have a capital gain.

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