1. If a high school student receives an expensive Italian sports car from a rich aunt as a graduation gift, what form of tax must the graduate pay? sales property inheritance gift

## Step 1<br />The problem presents a scenario where a high school student receives an expensive Italian sports car from a rich aunt as a graduation gift. The question asks us to identify the type of tax that the student must pay on this gift.<br /><br />## Step 2<br />The options provided are sales tax, property tax, inheritance tax, and gift tax. <br /><br />## Step 3<br />Sales tax is a tax that is levied on the sale of goods and services. This tax is not applicable in this case because the car is not being sold, but is being given as a gift.<br /><br />## Step 4<br />Property tax is a tax that is levied on the ownership of property. This tax is not applicable in this case because the car is not a piece of real estate.<br /><br />## Step 5<br />Inheritance tax is a tax that is levied on the transfer of property upon the death of the owner. This tax is not applicable in this case because the car is not being transferred upon the death of the owner.<br /><br />## Step 6<br />Gift tax is a tax that is levied on the transfer of money or property from one individual to another without receiving something of at least equal value in return. This tax is applicable in this case because the car is being given as a gift.