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Wills, Trusts, and Estates > Chapter 1 & 2 > Flashcards

Chapter 1 & 2 Flashcards

1
Q

Estate Plan

A

Arranging assets to gain benefits both in life and death maximizing financial benefits

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2
Q

Gross Estate

A

The total dollar value of all property and assets in which an individual had interest in at the time of their death.

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3
Q

Will

A

Legally enforceable written document

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4
Q

Testamentary

A

Effective on death

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5
Q

Ambulatory

A

Subject to change

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6
Q

Disposition

A

Transfer or conveyance or distribution of property

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7
Q

Types of Wills

A

Holographic, nuncupative, statutory, and typed

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8
Q

Statutes and Codes

A

Laws that govern distribution of property

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9
Q

U.P.C.

A

Uniform Probate Code

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10
Q

Uniform Probate Code

A

Minnesota adopted most but not all of the Code
Formal and informal Probate
Probate court-Domicile

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11
Q

Beneficiary

A

A person entitled to receive property under a will

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12
Q

Devisee/Legatee

A

A person who receives a gift of real property under a will

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13
Q

Codicil

A

An amendment to a will, that may modify or revoke provisions but does not invalidate. not used frequently anymore.

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14
Q

Requirements of a Will-Legal Capacity

A

18 years of age or older

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15
Q

Requirements of a Will-testamentary capacity

A

Soundness of mind

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16
Q

Requirements of a Valid Will

A 
Written document
Witnesses 
Signed by maker
Legal and testamentary capacity 
Execution of a valid will
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17
Q

Execution of a valid will

A

U.P.C.
Two witnesses
Self-proving affidavit

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18
Q

Provisions in a Will: Apportionment Clause

A

The residuary beneficiary will pay estate taxes. The simplest way for a personal representative to figure out from what money the taxes should be paid.

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19
Q

Provisions or Articles in a Will-Residuary Clause

A

A clause in a will the disposes of the remaining assets (residue) of the decedent after all debts and gifts in the will are satisfied

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20
Q

Probate

A

A court that supervises the administration of the estate

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21
Q

Decedent

A

The person who has died

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22
Q

Intestate

A

Dying with out a “valid will”

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23
Q

Testate

A

Dying with a valid will

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24
Q

Testator/testatrix

A

Make and female maker of wills

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25
Q

Letters of instruction

A

A document that specifies the testators instructions for organ donation and funeral and burial plans. It can also be an all-inclusive checklist of various personal and estate information to help the family and personal representative locate and identify property and documents necessary to administer the estate.

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26
Q

Heir

A

A person who receives a gift of real property from intestate

27
Q

Next of Kin

A

The closest blood relatives of decedent

28
Q

Trust

A

The right of property, real and personal to be held by one for the benefit of another

29
Q

Settlor/Creator/Trustor

A

Person who creates trust

30
Q

Trust “res”

A

Property of the trust

31
Q

Trustee

A

Person having legal title to property who takes control and administers

32
Q

Beneficiary

A

Holds equitable title and receives benefit of trust

33
Q

Legal Title

A

The form of ownership of trust property held by the trustee giving the trustee the right to control and manage the property for another’s benefit, I.e. The holder of the equitable title

34
Q

Equitable title

A

The right of the party who holds the equitable title or beneficial interest to the benefits of the trust. The party has the right to have the legal title transferred to him.

35
Q

Testamentary trust

A

Effective on death

36
Q

Inter-vivos Trusts

A

Effective during ones life

37
Q

Fiduciary

A

Person holding highest duty of care

38
Q

Types of fiduciary

A 
Personal representative 
Administrator or administratrix 
Trustee
Guardian 
Conservator
39
Q

Real property

A

Realty or real estate. Land and generally whatever is built on it or growing on or affixed (permanently attached) to the land.

40
Q

Personal property

A

Moveable property. Everything subject to ownership that is not real estate.

41
Q

Tangible personal property

A

Property that can be touched. I.e. Furniture, jewelry, or a car.

42
Q

Intangible personal property

A

A personal property interest that cannot be touched or moved. I.e. The right to sue another person, cash, stocks and bonds.

43
Q

How do fixtures (personal property) become real property?

A

If the removal of this fixture would result in lower value of the real property, then it becomes real property. I.e. Furnace in a building, or carpet on the floor.

44
Q

Deed

A

A written document where the grantor(s) convey title to real property to grantee(s)

45
Q

Gross estate

A

All of a persons property before deductions (debts, taxes, and other expenses or liabilities) that is subject to the federal estate tax.

46
Q

Disinherit

A

Elective or forced share of spouse, right to claim under the will intestate share

47
Q

Property ownership: types of concurrent ownership-Joint Tenancy

A

Ownership of real or personal property by two or more persons with the right of survivorship

48
Q

Property Ownership: Types of concurrent ownership-Tenancy in Common

A

The ownership of undivided interest of real or personal property by two or more personals without the right of survivorship. Each person has the right to hold or occupy the whole property in common with the other co-tenants, and each is entitled to share in the profits derived from the property. Unlike a joint tenancy, when a tenant in common dies, the decedents interests goes to an heir or as directed in will.

49
Q

Property Ownership: Types of concurrent ownership-Tenancy by the Entirety

A

A form of joint tenancy with the right of survivorship available only to a husband and wife. Essentially joint tenancy modified by the common law theory that husband and wife are one person. Neither one of the tenants can sever the tenancy without the consent of the other spouse.

50
Q

Property Ownership: Types of concurrent ownership-Community Property

A

All property, other than property received by gift, will, or inheritance, acquired by either spouse during marriage that is considered to belong to both slides equally in the nine community property states.

51
Q

Joint Tenancy-Advantages

A

Avoids Probate
Passes by operation of law
Passes free of claims of creditors
If husband and wife no estate and gift tax
Avoids ancillary administration
If bank accounts provides immediate access to funds
Created inexpensively

52
Q

Joint Tenancy-Disadvantages

A

Person gives up sole ownership

53
Q

Common Law Four Unities:

A

Unity of Time
Unity of Possession
Unity of Interest
Unity of Title

54
Q

Unity of Time

A

Joint tenant owners must receive or take their interests in property together. At the same time.

55
Q

Unity of title

A

The tenancy must be created and the tenants must receive their title (ownership rights) from a single source. I.e. Same will or deed.

56
Q

Unity of interest

A

Each tenant must have an interest in the property identical with that of the other tenants; he interests must be of the same quantity and duration

57
Q

Unity of possession

A

Each joint tenant must own and hold the same undivided possession of the whole property held in joint tenancy. The right to possess the entire property and share equally in the profits and losses derived from the property

58
Q

Straw man

A

Transfer from individual owners to two or more as joint tenants

59
Q

Severance

A

Act of terminating joint tenancy

60
Q

Estates in Real Property: Freehold

A

Fee simple absolute and life estates

61
Q

Estates in real property-Leasehold

A

Divides the right of ownership. Extent and duration of the individuals interest or according to how long and how much of an interest a person has in realty

62
Q

Future interests: Reversion

A

The interest in real property that a grantor retains when a conveyance of the property by deed or by will transfers an estate smaller than what the grantor owns. The real property reverts back to the grantor.

63
Q

Future Interests: Remainder

A

The balance of an estate after all the other provisions of the will have been satisfied

64
Q

Waste

A

Any act or omission that does permanent damage to real property or unreasonably changes its character or value

Wills, Trusts, and Estates (2 decks)

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