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Under present-day tax law, community property rules are followed in allocating income between husband and wife. Is this consistent with Lucas v. Earl? Explain. Question
Under present-day tax law, community property rules are followed in allocating income between husband and wife. Is this consistent with Lucas v. Earl? Explain. Question content area bottom Part 1 A. Under community property law community income is divided based on who benefited the most from the income. The question of who performed services that produce the income is ignored. This is contrary to Lucas v. Earl because the person who performed the services is taxed not the person who received the benefits. B. Under community property law, all property owned before the marriage and gifts and inheritances acquired after marriage are not included as property in the divorce. This is consistent with Lucas v. Earl because the earnings from labor are taxed to the person who performs the services rather than the person who receives the benefit of the income. Therefore, if a spouse purchases stock prior to the marriage it remains in their name only after the marriage. C. Under community property law community income is divided based on percentage of household income contribution. Therefore, whichever spouse contributed more income they receive more property during the divorce. This is consistent with Lucas v. Earl because the earnings from
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