in her current - year gross income. Which of the following form(s) the basis for this treatment? I. Capital recovery
in her current - year gross income. Which of the following form(s) the basis for this treatment? I. Capital recovery
Chapter11: Property Dispositions
Section: Chapter Questions
Problem 94TPC
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Question
Transcribed Image Text:Helen receives stock worth $1,000 from her grandfather as
a graduation gift in the current year (her grandfather paid
$100 for the stock many years ago) . During the current
year, she receives a $100 cash dividend on the stock. Helen
is not taxed on the value of the stock received in the
current year, but she must include the $100 cash dividend
in her current - year gross income. Which of the following
form(s) the basis for this treatment? I. Capital recovery
concept II. Legislative grace concept III. All inclusive
income concept IV. Constructive receipt doctrine a.
Statements I and IV are correct. b. Statements II, III, and IV
are correct. c. Statements II and III are correct. d. Only
statement I is correct. e. Statements II and IV are correct.
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