Chapter 9 Flashcards
An investment professional, who is not an attorney is engaged. The unauthorized practice of law would hear she counts as a client regarding the
A. Rules of the federal estate tax.
B. Meeting of the estate planning terms.
C. Advisibility of having a will.
D. Validity of a living will.
d. Determine the validity of a living will is not an allowable activity for an investment professional. Offering council for the other matters is acceptable.
Tax related financial goals for estate planning include
I. Deferring incoming gains
II. Maintaining the owner’s basis.
III. shifting receipt of income
IV. Shitting taxation of income.
A. I only
B. I and II only
C. II, III, and IV only
D. I, III, and IV only
D. I, III, and IV only
The probate process applies to all of the following except
A. All assets owned only in the deceased’s name
B. Household items and other personal property that is held outside of a trust.
C. A payable of death (POD) bank account.
D. Amount owed to the decedent before death, but not paid until after death.
C. A payable of death (POD) bank account.
which one of the following statements about the marital deduction is false?
A. The limit on the marital deduction for the gift taxes lower than the limit for the estate tax marital deduction.
B. The marital deduction could merely delay tax.
C. The marital deduction has unlimited in about for qualifying transfers to a spouse who is a US citizen.
D. It may not be wise for the first spouse to die to give everything to the surviving spouse in a manner that will qualify for the marital deduction.
A. The limit on the marital deduction for the gift taxes lower than the limit for the estate tax marital deduction.
A charitable lead annuity trust (CLAT)
A. Provide a charity with the remainder interest at a future time
B. Is a revocable trust
C. Provides the charity with a fixed percentage of the trust value in the remainder interest goes to a non-charitable beneficiary
D. Provides a charity with a guaranteed annuity and the remainder interest goes to a non-charitable beneficiary
D. Provides a charity with a guaranteed annuity and the remainder interest goes to a non-charitable beneficiary
A recipient of gifted property
A. Receive a basis in the property equal to its fair market value at the time of the gift.
B. Receive the donors income tax basis, if the value of the property equals or exceeds the donor basis.
C. Receive a basis equal to what a willing buyer would pay for the property.
D. Receive a basis in the property equal to its fair market value at the time of death.
B. Receive the donors income tax basis, if the value of the property equals or exceeds the donor basis.
A revocable living trust is suitable for which of the following purposes?
I. Avoiding probate.
II. Planning for in capacity.
III. Removing assets from grantors gross estate.
A. I only
B. I and II only
C. II only
D. I, II and III
B. I and II only
Which of the following statements regarding ILITs are correct
I. ILITs can either be funded or unfunded
II. Funding with an existing policy may cause a three-year rule to apply.
III. The main purpose of an ILIT is to remove policy death benefits from the grantor’s gross estate
If. Contributions to pay premiums are considered additional gifts.
A. I and II only
B. III and IV only
C. II, III, and IV only
D. I, II, III, and IV
D. I, II, III, and IV
Which of the following are characteristics of a section 2503b trust?
I. The trust is revocable.
II. The trust may pay out all trust income annually.
III. The trust may only have one beneficiary.
IV. All trust assets must be made available to the beneficiaries at age 21.
A. I only
B. II only
C. II and II only
D. I, III, and IV only
B. II only
