Molly sells her car, valued at $30,000, to her nephew Todd for $18,000. Molly has made a taxable gift.

Name: Molly sells her car, valued at $30,000, to her nephew Todd for $18,000. Molly has made a taxable gift.
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Question

Quizplus · Accepted Answer

Molly made a gift of $12,000 ($30,000 - $18,000) to her nephew Todd, which exceeds the annual gift tax exclusion of $15,000 per recipient. Therefore, she has made a taxable gift and may have to pay gift tax.

Molly Sells Her Car, Valued at $30,000, to Her Nephew