When an individual gives his or her child an income-producing asset,he or she is ____________.

Question

When an individual gives his or her child an income-producing asset,he or she is ____________. ​

Quizplus · Accepted Answer

When an individual gives his or her child an income-producing asset, he or she is shifting his or her income. By transferring the asset to the child, the income generated from it will be taxed at the child's lower tax rate instead of the parent's higher tax rate, resulting in tax savings for the family. This is a common tax planning strategy used by parents to reduce their overall tax liability.

When an Individual Gives His or Her Child an Income-Producing