Question 1

List the various categories of estate tax deductions, and compare them with the categories of gift tax deductions. What differences exist?

Accepted Answer

Estate tax deductions are as follows: ma

Question 2

Which of the following credits is available for estate tax purposes?

Accepted Answer

A)  investment tax credit 
B)  credit for income taxes paid on decedent's final return 
C)  credit for estate taxes paid on certain prior transfers 
D)  All of the above are available. 
A)  investment tax credit 
B)  credit for income taxes paid on decedent's final return 
C)  credit for estate taxes paid on certain prior transfers 
D)  All of the above are available.

Question 3

Joe dies late in 2017 and his estate is subject to an estate tax of $2 million. He leaves all of his assets to his daughter, Claudia. Claudia dies in early 2019. Which of the following statements is correct?

Accepted Answer

A)  Claudia's estate receives no credit or deduction for the tax paid by Joe's estate. 
B)  Claudia's estate receives a credit for $1,000,000 of Joe's estate tax. 
C)  Claudia's estate receives a credit for $2,000,000 of Joe's estate tax. 
D)  Claudia's estate receives a deduction for $2,000,000 of Joe's estate tax. 
A)  Claudia's estate receives no credit or deduction for the tax paid by Joe's estate. 
B)  Claudia's estate receives a credit for $1,000,000 of Joe's estate tax. 
C)  Claudia's estate receives a credit for $2,000,000 of Joe's estate tax. 
D)  Claudia's estate receives a deduction for $2,000,000 of Joe's estate tax.

Question 4

Briefly discuss how inter vivos gifts can be used to reduce the size of the estate tax base.

Accepted Answer

The $15,000 per-donee per-year exclusion

Question 5

Listed stocks are valued at their closing price on the date of death.

Accepted Answer

A) True 
 B)False

Question 6

A qualified disclaimer is a valuable estate planning tool because

Accepted Answer

A)  it establishes the value of the disclaimed assets. 
B)  it qualifies the assets for the alternative valuation date. 
C)  it is not treated as a gift made by the person who disclaims. 
D)  it allows the person making the disclaimer to determine the recipient. 
A)  it establishes the value of the disclaimed assets. 
B)  it qualifies the assets for the alternative valuation date. 
C)  it is not treated as a gift made by the person who disclaims. 
D)  it allows the person making the disclaimer to determine the recipient.

Question 7

Identify which of the following statements is true.

Accepted Answer

A)  The transferee is liable for the generation-skipping transfer tax (GSTT) in the case of a direct skip. 
B)  Special use valuation is available for farmland to help alleviate liquidity problems. 
C)  Qualified disclaimers are not available for estate planning purposes. 
D)  All of the above are false. 
A)  The transferee is liable for the generation-skipping transfer tax (GSTT) in the case of a direct skip. 
B)  Special use valuation is available for farmland to help alleviate liquidity problems. 
C)  Qualified disclaimers are not available for estate planning purposes. 
D)  All of the above are false.

Question 8

When computing the federal estate tax liability in 2019, which of the following taxable estates (not tentative tax) would the unified credit for the current year eliminate all of the tax is

Accepted Answer

A)  $15,555,800. 
B)  $17,800,800. 
C)  $11,400,000. 
D)  $12,000,000. 
A)  $15,555,800. 
B)  $17,800,800. 
C)  $11,400,000. 
D)  $12,000,000.

Question 9

Donna died on June 1 of the current year. The executor considers the following information when preparing her estate tax return:
• In 1997, Donna transfers title to her personal residence to her son. The residence is worth $60,000 on the transfer date. Donna continued to live alone in the residence until her death. She did not pay any rent. At her death, the residence is worth $100,000.
• In 1998, Donna created an irrevocable trust and funded it with $300,000 of assets. Donna names a bank as trustee. According to the trust agreement, all the trust income is to be paid out annually for 25 years. The trustee, however, is to decide how much income to pay each year to Donna's son and daughter. Upon termination of the trust, the assets are to be distributed equally among her two children or their estates. The trust's assets are worth $320,000 when Donna dies.
• In 1998, Donna created a revocable trust with a bank named as trustee. She named her grandchild Joe as the beneficiary for life. Upon Joe's death, the property is to be distributed equally among Joe's descendants. The trust assets are worth $300,000 when Donna dies. How much would be included in Donna's gross estate?

Accepted Answer

$100,000 (residence)

Question 10

The estate tax is a wealth transfer tax.

Accepted Answer

A) True 
 B)False

Question 11

Which of the following is not a credit for purposes of computing the federal estate tax liability?

Accepted Answer

A)  credit for gift tax paid on pre-1977 gifts 
B)  credit for estate taxes paid on certain prior transfers 
C)  a credit for foreign death taxes 
D)  All of the above are credits for the federal estate tax. 
A)  credit for gift tax paid on pre-1977 gifts 
B)  credit for estate taxes paid on certain prior transfers 
C)  a credit for foreign death taxes 
D)  All of the above are credits for the federal estate tax.

Question 12

Reversionary interests in publicly traded stocks included in a gross estate must be valued

Accepted Answer

A)  by an independent actuary. 
B)  by an appraiser. 
C)  by considering the fact that the transferor has died. 
D)  using actuarial tables. 
A)  by an independent actuary. 
B)  by an appraiser. 
C)  by considering the fact that the transferor has died. 
D)  using actuarial tables.

Question 13

Guy died this year. His estate includes a closely held business interest valued at $400,000 and other property valued at $675,000. Guy's allowable Sec. 2053 and 2054 deductions total $75,000. Within three years of death, partly in hopes of qualifying his estate for the installment payment allowed under Sec. 6166 treatment, Guy made gifts of listed securities of $350,000 (at 2002 valuations) and paid no gift tax on the gift. Is Guy's estate eligible for Sec. 6166 treatment?

Accepted Answer

No, it fails the 35% test in o

Question 14

Lou dies on April 12, 2015. All of Lou's property passed to Paula, his daughter. Paula dies on January 15, 2019. Both Lou's and Paula's estates pay federal estate taxes. Lou's estate tax was $350,000. How much can Paula's estate claim for a credit for tax on prior transfers?

Accepted Answer

A)  $350,000 
B)  $280,000 
C)  $210,000 
D)  $140,000 
A)  $350,000 
B)  $280,000 
C)  $210,000 
D)  $140,000

Question 15

In 2019, Paul transfers $1,000,000 to a trust benefiting his three children. As trustee, he has the power to determine the amount of distributions each year. Paul dies in the current year when the trust has a value of $1,200,000. How much of the trust's value is included in Paul's estate?

Accepted Answer

A)  $0 
B)  $400,000 
C)  $1,000,000 
D)  $1,200,000 
A)  $0 
B)  $400,000 
C)  $1,000,000 
D)  $1,200,000

Question 16

Two years ago, Nils transfers a $200,000 life insurance policy on his life to his daughter, Gail. The policy is worth $60,000 at the time of transfer and Gail pays Nils $50,000. When Nils dies this year, the $50,000 cash is still in a savings account. The consideration offset when computing Nils's gross estate is

Accepted Answer

A)  $0. 
B)  $50,000. 
C)  $150,000. 
D)  $166,667. 
A)  $0. 
B)  $50,000. 
C)  $150,000. 
D)  $166,667.

Question 17

Julian died on November 1 and owned 100 shares of a New York Stock Exchange stock. The stock traded at a high of 100 and a low of 98 on November 1. It opened at 98 and closed at 100. On Julian's estate tax return, what will the per-share and total value of the stock be?

Accepted Answer

($100 + 98)/2 = $99

Question 18

The value of stock that is not publicly traded may be determined by considering

Accepted Answer

A)  the nature and history of the business. 
B)  earning capacity. 
C)  dividend-paying capacity. 
D)  all of the above 
A)  the nature and history of the business. 
B)  earning capacity. 
C)  dividend-paying capacity. 
D)  all of the above

Question 19

Identify which of the following statements is true.

Accepted Answer

A)  The credit for taxes paid on prior transfers does not reduce the impact of property being taxed in more than one estate in quick succession. 
B)  The deduction for state death taxes is not limited. 
C)  An estate is not entitled to a credit for foreign death taxes paid on property located in a foreign country and included in the gross estate. 
D)  All of the above are false. 
A)  The credit for taxes paid on prior transfers does not reduce the impact of property being taxed in more than one estate in quick succession. 
B)  The deduction for state death taxes is not limited. 
C)  An estate is not entitled to a credit for foreign death taxes paid on property located in a foreign country and included in the gross estate. 
D)  All of the above are false.

Question 20

The tax base for the federal estate tax is the total of the decedent's taxable estate and post-1986 taxable gifts if the decedent made gifts in 1981.

Accepted Answer

A) True 
 B)False

List the various categories of estate tax deductions, and compare them with the categories of gift tax deductions. What differences exist?

Which of the following credits is available for estate tax purposes?

Joe dies late in 2017 and his estate is subject to an estate tax of $2 million. He leaves all of his assets to his daughter, Claudia. Claudia dies in early 2019. Which of the following statements is correct?

Briefly discuss how inter vivos gifts can be used to reduce the size of the estate tax base.

Listed stocks are valued at their closing price on the date of death.

A qualified disclaimer is a valuable estate planning tool because

Identify which of the following statements is true.

When computing the federal estate tax liability in 2019, which of the following taxable estates (not tentative tax) would the unified credit for the current year eliminate all of the tax is

The estate tax is a wealth transfer tax.

Which of the following is not a credit for purposes of computing the federal estate tax liability?

Reversionary interests in publicly traded stocks included in a gross estate must be valued

Lou dies on April 12, 2015. All of Lou's property passed to Paula, his daughter. Paula dies on January 15, 2019. Both Lou's and Paula's estates pay federal estate taxes. Lou's estate tax was $350,000. How much can Paula's estate claim for a credit for tax on prior transfers?

In 2019, Paul transfers $1,000,000 to a trust benefiting his three children. As trustee, he has the power to determine the amount of distributions each year. Paul dies in the current year when the trust has a value of $1,200,000. How much of the trust's value is included in Paul's estate?

Julian died on November 1 and owned 100 shares of a New York Stock Exchange stock. The stock traded at a high of 100 and a low of 98 on November 1. It opened at 98 and closed at 100. On Julian's estate tax return, what will the per-share and total value of the stock be?

The value of stock that is not publicly traded may be determined by considering

Identify which of the following statements is true.

The tax base for the federal estate tax is the total of the decedent's taxable estate and post-1986 taxable gifts if the decedent made gifts in 1981.

Tax Research

Corporate Formations and Capital Structure

The Corporate Income Tax

Corporate Nonliquidating Distributions

Other Corporate Tax Levies

Corporate Liquidating Distributions

Corporate Acquisitions and Reorganizations

Consolidated Tax Returns

Partnership Formation and Operation

Special Partnership Issues

S Corporations

The Gift Tax

Income Taxation of Trusts and Estates

Administrative Procedures

Us Taxation of Foreign-Related Transactions

Filters

Exam 13: The Estate Tax

List the various categories of estate tax deductions, and compare them with the categories of gift tax deductions. What differences exist?

Which of the following credits is available for estate tax purposes?

Joe dies late in 2017 and his estate is subject to an estate tax of $2 million. He leaves all of his assets to his daughter, Claudia. Claudia dies in early 2019. Which of the following statements is correct?

Briefly discuss how inter vivos gifts can be used to reduce the size of the estate tax base.

Listed stocks are valued at their closing price on the date of death.

A qualified disclaimer is a valuable estate planning tool because

Identify which of the following statements is true.

When computing the federal estate tax liability in 2019, which of the following taxable estates (not tentative tax) would the unified credit for the current year eliminate all of the tax is

The estate tax is a wealth transfer tax.

Which of the following is not a credit for purposes of computing the federal estate tax liability?

Reversionary interests in publicly traded stocks included in a gross estate must be valued

Lou dies on April 12, 2015. All of Lou's property passed to Paula, his daughter. Paula dies on January 15, 2019. Both Lou's and Paula's estates pay federal estate taxes. Lou's estate tax was $350,000. How much can Paula's estate claim for a credit for tax on prior transfers?

In 2019, Paul transfers $1,000,000 to a trust benefiting his three children. As trustee, he has the power to determine the amount of distributions each year. Paul dies in the current year when the trust has a value of $1,200,000. How much of the trust's value is included in Paul's estate?

Julian died on November 1 and owned 100 shares of a New York Stock Exchange stock. The stock traded at a high of 100 and a low of 98 on November 1. It opened at 98 and closed at 100. On Julian's estate tax return, what will the per-share and total value of the stock be?

The value of stock that is not publicly traded may be determined by considering

Identify which of the following statements is true.

The tax base for the federal estate tax is the total of the decedent's taxable estate and post-1986 taxable gifts if the decedent made gifts in 1981.

Tax Research

Corporate Formations and Capital Structure

The Corporate Income Tax

Corporate Nonliquidating Distributions

Other Corporate Tax Levies

Corporate Liquidating Distributions

Corporate Acquisitions and Reorganizations

Consolidated Tax Returns

Partnership Formation and Operation

Special Partnership Issues

S Corporations

The Gift Tax

Income Taxation of Trusts and Estates

Administrative Procedures

Us Taxation of Foreign-Related Transactions

Filters