Classify each of the following statements.
-Meg gives her 18-year-old son money for his college tuition and living expenses (e.g., room and board).

Question

Quizplus · Accepted Answer

Payments made directly to an educational institution for tuition or to a provider for medical expenses on behalf of another person are not considered taxable gifts under U.S. tax law. Since the question specifies the money is for college tuition and living expenses, it's considered support, not a taxable gift. Estate tax does not apply as it is concerned with transfers of estate after death.

Classify Each of the Following Statements