Question

which of the following is an example of a transfer tax? A. income tax. B.. estate tax. C. income in respect of a decedent. D. self-employment tax.

Answer 1

Transfer tax means that the tax liability is transferred from the actual person to some other person due to some circumstances or any transaction.

Income tax is levied to the individual itself and is to be paid by the individual only and this cannot be transferred to any other person whatsoever. Estate tax is paid by the Owner of the property and cannot be transferred to the person to whom the property is transferred. Self employment tax , as the name suggests is the tax levied on the self employment of the individual and is to be paid by the individual only.

Income in respect of a decedent is to a type of transfer tax which is transferred when a person dies and afterwards the tax is to be paid by any decedent of the deceased person as per the will.

Therefore the correct option is C