Exam 18: The Federal Gift and Estate Taxes

A father wants to give a parcel of land to his two children. If he wants the survivor to have sole ownership, he should list ownership of the property as joint tenants.

At the time of his death, Gene held a Roth IRA account with his wife as the designated beneficiary. The IRA is included in Gene's gross estate.

Which, if any, of the following is not a characteristic of the Federal gift tax?

In what manner does the tax law favor contributions to (higher) qualified tuition plans under § 529?

The § 2513 election to split gifts is less useful in community property states than in common law states. Explain.

Mitch pays the surgeon and the hospital for his nondependent aunt's heart bypass operation. The transfer is not subject to the gift tax.

Concerning the formula for the Federal estate tax, which, if any, of the following statements is correct?

Rachel owns an insurance policy on the life of Albert with Belle as the designated beneficiary. Upon Rachel's death, nothing regarding this policy is included in her gross estate.

All of the charitable organizations that qualify for estate tax purposes also qualify for income tax purposes.

At the time of her death on October 4, 2016, Kaitlyn was involved in the following transactions. ∙ Was the sole life beneficiary of a trust (assets worth $2 million) created 10 years ago by Paul (Kaitlyn's husband). The transfer was by gift of securities then worth $500,000 (Paul did not make a QTIP election). Paul and Kaitlyn's children are the remainder persons. ∙ Owned stock in Mauve Corporation (basis of $800,000 and fair market value of $1 million). On September 7, 2016, a dividend of $48,000 was declared on the stock payable to all shareholders on record as of October 3, 2016. The $48,000 was received by Kaitlyn's executor on October 19, 2016. ∙ Kaitlyn made a taxable gift of $400,000 in 2004. As to these transactions, Kaitlyn's gross estate includes:

A transfer in trust in which the trustee has the power to accumulate income is not a gift of a future interest if the trustee never exercises the power.

Match each statement with the correct choice. Some choices may be used more than once or not at all. -Decedent owned a policy on the life of his spouse with himself as the designated beneficiary. The spouse survives.

Match each statement with the correct choice. Some choices may be used more than once or not at all. -Surviving spouse's share of the community property.

In most cases, the gross estate of a decedent is larger than the probate estate.

What is the justification for the terminable interest rule that is applicable to the marital deduction?

Which, if any, of the following statements correctly reflects the rules applicable to the alternate valuation date ?

Which, if any, of the following items is subject to indexation (adjusted to reflect inflation)?

Doyle died in 2000 and by will created a trust with the following provisions: "life estate to my wife, Grace, remainder upon her death to our children." Grace dies this year. Is the trust Doyle created included in Grace's gross estate? Explain.

Match each statement with the correct choice. Some choices may be used more than once or not at all. -Proceeds of an insurance policy on decedent's life. Decedent's son purchased the policy and is its owner and beneficiary.

At the time of his death, Jason was a participant in Silver Corporation's qualified pension plan and group term life insurance. The balance of the survivorship feature in his pension plan is: ? Contributions by Silver \ 800,000 After-tax contributions by Jason 400,000 Plan earnings 300,000 ? The term insurance has a maturity value of $100,000. All amounts are paid to Pam, Jason's daughter. One result of these transactions is: