Taxation - Co-ownership, Estates and Trusts Quiz 2023
Complete
It arises when two or more heirs or beneficiaries inherit an undivided property from a
decedent or when a donor makes a gift of an undivided in favor of two or more donees
Co ownership
When will an inherited property be considered as owned by an unregistered
partnership?
I. When the property remained undivided for more than ten (10) years
II. When no attempt was ever made to divide the same among the co-heirs, nor was the
property under administration proceeding nor held in trust
Conditions I and II are required
Pedro, Juan and Antonio are heirs of Luna who died on November 1, 2018. The
properties of Luna comprised solely of real property valued at P50,000,000 at the time
of his death. The property is subject to lease earning rental income. During 2019 the
property remained undivided and it derived a net rental income of P15,000,000.
For income tax purposes, the heirs will be tax on net rental income from the inherited
property for the year 2019 as:
A. Partners in a commercial partnership
B. Partners in a general professional partnership
C. Partners in an unregistered co-partnership
D. Co-owners
Co-owners
Pedro, Juan and Antonio are heirs of Luna who died on November 1, 2018. The
properties of Luna comprised solely of real property valued at P50,000,000 at the time
of his death. The property is subject to lease earning rental income. During 2019 the
property remained undivided and it derived a net rental income of P15,000,000.
What amount should be reported as taxable income of the co-ownership in 2019?
Answer: 0
A co-ownership is a non taxable entity.
Pedro, Juan and Antonio are heirs of Luna who died on November 1, 2018. The
properties of Luna comprised solely of real property valued at P50,000,000 at the time
of his death. The property is subject to lease earning rental income. During 2019 the
property remained undivided and it derived a net rental income of P15,000,000.
What amount should each heir report in their individual returns as their share in the net
rental income of the property they inherited in 2019?
Answer: 5,000,000
15M / 3 = 5M each
, Income received by the estate during the period of administration or settlement of the
estate, for tax purposes is known as
Income of the estate
Statement 1: For taxation purposes, the taxable income of the estate shall be determine
in the same manner an basis as in the case of individual taxpayers.
Statement 2: Upon the effectivity of the TRAIN law, personal exemption is no longer
allowed to be deducted from the income of the estate.
Statements 1 and 2 are true
Statement 1: Where the estate is under judicial administration, the income of the estate
shall be taxable to the fiduciary or trustee
Statement 2: Where the estate is not under judicial administration, the income of the
estate shall be taxable to the heirs and beneficiaries
Statements 1 and 2 are true
Statement 1: The amount of income of the estate for the taxable year, which is properly
paid or credited during such year to any legatee, heir or beneficiary, is a special item of
deduction from the gross income of the estate
Statement 2: An allowance paid to a widow or heir out of the corpus of the estate is not
deductible form the gross income of the estate
Statements 1 and 2 are true
Statement 1: when an estate, under administration, has income-producing properties
the annual income of the estate becomes part of the taxable gross estate.
Statement 2: When an estate, under administration, has income-producing properties
and its income during the year is distributed to the heirs, the income so distributed is
taxable too the heirs as part of their gross income for the year.
Statement 1 is false but Statement 2 is correct
The following statements refer to the rules in determining the taxable income and the
applicable income tax liability of an estate. Which of the statements is/are correct?
I. The items of gross income of the estate are the same items as the items of gross
income of individual taxpayers
II. Deductions from the gross income of the estate are the same as the items of
deductions allowed to an individual taxpayer.
III. In addition to the allowable deduction under section 34 of the tax code, the estate is
allowed to deduct the amount of income of the estate during the taxable year that is
paid or credited to the legatee, heir, or beneficiary
IV. The amount of income of the estate during the year that is paid or credited to the
legatee, heir or beneficiary is subject to final withholding tax of 15%
I, II and III only
Complete
It arises when two or more heirs or beneficiaries inherit an undivided property from a
decedent or when a donor makes a gift of an undivided in favor of two or more donees
Co ownership
When will an inherited property be considered as owned by an unregistered
partnership?
I. When the property remained undivided for more than ten (10) years
II. When no attempt was ever made to divide the same among the co-heirs, nor was the
property under administration proceeding nor held in trust
Conditions I and II are required
Pedro, Juan and Antonio are heirs of Luna who died on November 1, 2018. The
properties of Luna comprised solely of real property valued at P50,000,000 at the time
of his death. The property is subject to lease earning rental income. During 2019 the
property remained undivided and it derived a net rental income of P15,000,000.
For income tax purposes, the heirs will be tax on net rental income from the inherited
property for the year 2019 as:
A. Partners in a commercial partnership
B. Partners in a general professional partnership
C. Partners in an unregistered co-partnership
D. Co-owners
Co-owners
Pedro, Juan and Antonio are heirs of Luna who died on November 1, 2018. The
properties of Luna comprised solely of real property valued at P50,000,000 at the time
of his death. The property is subject to lease earning rental income. During 2019 the
property remained undivided and it derived a net rental income of P15,000,000.
What amount should be reported as taxable income of the co-ownership in 2019?
Answer: 0
A co-ownership is a non taxable entity.
Pedro, Juan and Antonio are heirs of Luna who died on November 1, 2018. The
properties of Luna comprised solely of real property valued at P50,000,000 at the time
of his death. The property is subject to lease earning rental income. During 2019 the
property remained undivided and it derived a net rental income of P15,000,000.
What amount should each heir report in their individual returns as their share in the net
rental income of the property they inherited in 2019?
Answer: 5,000,000
15M / 3 = 5M each
, Income received by the estate during the period of administration or settlement of the
estate, for tax purposes is known as
Income of the estate
Statement 1: For taxation purposes, the taxable income of the estate shall be determine
in the same manner an basis as in the case of individual taxpayers.
Statement 2: Upon the effectivity of the TRAIN law, personal exemption is no longer
allowed to be deducted from the income of the estate.
Statements 1 and 2 are true
Statement 1: Where the estate is under judicial administration, the income of the estate
shall be taxable to the fiduciary or trustee
Statement 2: Where the estate is not under judicial administration, the income of the
estate shall be taxable to the heirs and beneficiaries
Statements 1 and 2 are true
Statement 1: The amount of income of the estate for the taxable year, which is properly
paid or credited during such year to any legatee, heir or beneficiary, is a special item of
deduction from the gross income of the estate
Statement 2: An allowance paid to a widow or heir out of the corpus of the estate is not
deductible form the gross income of the estate
Statements 1 and 2 are true
Statement 1: when an estate, under administration, has income-producing properties
the annual income of the estate becomes part of the taxable gross estate.
Statement 2: When an estate, under administration, has income-producing properties
and its income during the year is distributed to the heirs, the income so distributed is
taxable too the heirs as part of their gross income for the year.
Statement 1 is false but Statement 2 is correct
The following statements refer to the rules in determining the taxable income and the
applicable income tax liability of an estate. Which of the statements is/are correct?
I. The items of gross income of the estate are the same items as the items of gross
income of individual taxpayers
II. Deductions from the gross income of the estate are the same as the items of
deductions allowed to an individual taxpayer.
III. In addition to the allowable deduction under section 34 of the tax code, the estate is
allowed to deduct the amount of income of the estate during the taxable year that is
paid or credited to the legatee, heir, or beneficiary
IV. The amount of income of the estate during the year that is paid or credited to the
legatee, heir or beneficiary is subject to final withholding tax of 15%
I, II and III only
