Question 1

The kiddie tax applies to all unearned income of a child under 19.

Accepted Answer

A) True 
 B)False

Question 2

A fiduciary tax return must be filed for

Accepted Answer

A)  a decedent 
B)  a decedent's estate 
C)  the grantor of a trust 
D)  the donee of a taxable gift 
A)  a decedent 
B)  a decedent's estate 
C)  the grantor of a trust 
D)  the donee of a taxable gift

Question 3

Which of the following gifts is not eligible for the annual exclusion?

Accepted Answer

A)  $20,000 given to a spouse 
B)  The remainder interest in a trust 
C)  $100,000 given to North Carolina State University. 
D)  All are eligible for the annual exclusion. 
A)  $20,000 given to a spouse 
B)  The remainder interest in a trust 
C)  $100,000 given to North Carolina State University. 
D)  All are eligible for the annual exclusion.

Question 4

Quinn made a taxable gift of a $4,500,000 home (after his annual exclusion) to his daughter in 2011. In December of the current year, Quinn made taxable gifts totaling $15,000,000 (after annual exclusions). What is Quinn's gift tax in 2018 if 2011 was the only year in which he made taxable gifts?

Accepted Answer

A)  $1,404,000 
B)  $1,420,000 
C)  $2,913,000 
D)  $4,654,200 
A)  $1,404,000 
B)  $1,420,000 
C)  $2,913,000 
D)  $4,654,200

Question 5

Gifts to most charities are not subject to gift taxes.

Accepted Answer

A) True 
 B)False

Question 6

Weilin's gross estate was valued at $12,175,000 when he died in 2018. His estate paid administration expenses of $100,000 and funeral expenses of $25,000. Weilin left $50,000 to Georgia State University and $500,000 in a qualifying terminable interest property trust for his second wife. If Weilin had made $1,500,000 of prior taxable gifts in 2014, paying a gift tax of $175,000 on these gifts, how much estate tax would the estate have had to pay in 2018?

Accepted Answer

$12,175,000 - $100,000 administrative ex

Question 7

If two properties are currently of equal value, giving away the property least likely to appreciate would reduce potential estate value.

Accepted Answer

A) True 
 B)False

Question 8

Putting cash into a joint bank account is a gift to the joint tenant when deposited.

Accepted Answer

A) True 
 B)False

Question 9

Distributable net income (DNI) is

Accepted Answer

A)  Is the maximum taxable distribution to a beneficiary from a trust 
B)  Is not taxable to the beneficiaries if it is a distribution of nontaxable income 
C)  Is the amount available for distribution from the trust 
D)  All are characteristics of DNI 
A)  Is the maximum taxable distribution to a beneficiary from a trust 
B)  Is not taxable to the beneficiaries if it is a distribution of nontaxable income 
C)  Is the amount available for distribution from the trust 
D)  All are characteristics of DNI

Question 10

Painting a house for your mother is not a taxable gift.

Accepted Answer

A) True 
 B)False

Question 11

Farouk transfers bonds with a face value of $10,000 into his dependent son's name on January 1, 2018 as his son will turn 24 this year. The bonds pay 8 percent interest annually and Farouk bought the bonds in 2009 for $9,500 (the discount was not required to be amortized). His son sells the bonds for $10,500 at the end of 2018 after receiving the 2018 interest. If Farouk is in the 37 percent marginal tax bracket, how much did he save in 2018 in taxes by transferring the bonds into his son's name. His son had no other income in 2018.

Accepted Answer

Farouk's income tax and capital gains ta

Question 12

The widow of a decedent may add the decedent's remaining lifetime exclusion to her lifetime exclusion only if the estate executor makes an irrevocable election.

Accepted Answer

A) True 
 B)False

Question 13

Payment to a college for a grandchild's tuition is not a taxable gift.

Accepted Answer

A) True 
 B)False

Question 14

Which of the following transfers is taxable under the gift tax statutes?

Accepted Answer

A)  Mark sold land to an unrelated party for less than its fair market value because he needed cash in a hurry. 
B)  After a friend's death, Sharron wrote a check to the university to pay the college tuition for the friend's son. 
C)  Marilynn wrote checks to the landlord to pay her aunt's rent for ten months when her aunt was unemployed. 
D)  Jose wrote a check to the doctor to pay a friend's medical bill when he had surgery. 
A)  Mark sold land to an unrelated party for less than its fair market value because he needed cash in a hurry. 
B)  After a friend's death, Sharron wrote a check to the university to pay the college tuition for the friend's son. 
C)  Marilynn wrote checks to the landlord to pay her aunt's rent for ten months when her aunt was unemployed. 
D)  Jose wrote a check to the doctor to pay a friend's medical bill when he had surgery.

Question 15

Explain the difference between a simple trust and a complex trust?

Accepted Answer

A simple trust must distribute all of it

Question 16

All of the following apply to the Coverdell education savings account except:

Accepted Answer

A)  Beneficiaries may be able to be changed. 
B)  Allows the same contribution as a Section 529 qualified tuition plan. 
C)  Has a $2,000 annual contribution limit. 
D)  Limits the contribution of higher income taxpayers. 
A)  Beneficiaries may be able to be changed. 
B)  Allows the same contribution as a Section 529 qualified tuition plan. 
C)  Has a $2,000 annual contribution limit. 
D)  Limits the contribution of higher income taxpayers.

The kiddie tax applies to all unearned income of a child under 19.

A fiduciary tax return must be filed for

Which of the following gifts is not eligible for the annual exclusion?

Quinn made a taxable gift of a $4,500,000 home (after his annual exclusion) to his daughter in 2011. In December of the current year, Quinn made taxable gifts totaling $15,000,000 (after annual exclusions). What is Quinn's gift tax in 2018 if 2011 was the only year in which he made taxable gifts?

Gifts to most charities are not subject to gift taxes.

If two properties are currently of equal value, giving away the property least likely to appreciate would reduce potential estate value.

Putting cash into a joint bank account is a gift to the joint tenant when deposited.

Distributable net income (DNI) is

Painting a house for your mother is not a taxable gift.

The widow of a decedent may add the decedent's remaining lifetime exclusion to her lifetime exclusion only if the estate executor makes an irrevocable election.

Payment to a college for a grandchild's tuition is not a taxable gift.

Which of the following transfers is taxable under the gift tax statutes?

Explain the difference between a simple trust and a complex trust?

All of the following apply to the Coverdell education savings account except:

Introduction to Taxation

The Tax Practice Environment

Determining Gross Income

Employee Compensation

Deductions for Individuals and Tax Determination

Business Expenses

Property Acquisitions and Cost Recovery Deductions

Property Dispositions

Tax-Deferred Exchanges

Taxation of Corporations

Sole Proprietorships and Flow-Through Entities

Filters

Exam 12: Estates, Gifts, and Trusts

The kiddie tax applies to all unearned income of a child under 19.

A fiduciary tax return must be filed for

Which of the following gifts is not eligible for the annual exclusion?

Quinn made a taxable gift of a $4,500,000 home (after his annual exclusion) to his daughter in 2011. In December of the current year, Quinn made taxable gifts totaling $15,000,000 (after annual exclusions). What is Quinn's gift tax in 2018 if 2011 was the only year in which he made taxable gifts?

Gifts to most charities are not subject to gift taxes.

If two properties are currently of equal value, giving away the property least likely to appreciate would reduce potential estate value.

Putting cash into a joint bank account is a gift to the joint tenant when deposited.

Distributable net income (DNI) is

Painting a house for your mother is not a taxable gift.

The widow of a decedent may add the decedent's remaining lifetime exclusion to her lifetime exclusion only if the estate executor makes an irrevocable election.

Payment to a college for a grandchild's tuition is not a taxable gift.

Which of the following transfers is taxable under the gift tax statutes?

Explain the difference between a simple trust and a complex trust?

All of the following apply to the Coverdell education savings account except:

Introduction to Taxation

The Tax Practice Environment

Determining Gross Income

Employee Compensation

Deductions for Individuals and Tax Determination

Business Expenses

Property Acquisitions and Cost Recovery Deductions

Property Dispositions

Tax-Deferred Exchanges

Taxation of Corporations

Sole Proprietorships and Flow-Through Entities

Filters