Question 1

Property inherited from a decedent has an adjusted basis equal to the value of the property included in the decedent's estate.

Accepted Answer

A) True 
 B)False

Question 2

For the holidays, Samuel gave a necklace worth $35,000 to Jennifer and jewelry worth $44,000 to Savannah. Samuel is married to Wendy and they live in a community-property state. Has Samuel made any taxable gifts and, if so, in what amounts?

Accepted Answer

$2,500 and $7,000.
Since the gifts are f

Question 3

At her death Siena owned real estate worth $200,000 that was titled with her sister in joint tenancy with the right of survivorship. Siena contributed $50,000 to the total cost of the property and her sister contributed the remaining $75,000. What amount, if any, is included in Siena's gross estate?

Accepted Answer

A)  $50,000. 
B)  $125,000. 
C)  $80,000. 
D)  $100,000. 
E)  None of the choices are correct. 
A)  $50,000. 
B)  $125,000. 
C)  $80,000. 
D)  $100,000. 
E)  None of the choices are correct.

Question 4

James and Jasmine live in a community-property state. This year they transferred $800,000 of property to an irrevocable trust that provides their son, Aaron, a life estate and their daughter, Lauren, the remainder. At the time of the gift, the Table S value for Aaron was .18031. What is the amount, if any, of the taxable gifts?

Accepted Answer

James and Jasmine each made taxable gift

Question 5

Chloe's gross estate consists of the following property valued at the date of death:   Chloe's real estate is encumbered by a mortgage of $450,000, and Chloe's executor paid her funeral costs of $6,000 and charged fees for $24,000. Which of the following is a true statement?

Accepted Answer

A)  Chloe's adjusted gross estate is at least $12,020,000. 
B)  Chloe's taxable estate is at least $12,020,000. 
C)  Chloe's taxable estate is $12,050,000. 
D)  Chloe's estate will calculate the tentative estate tax on $12.5 million. 
E)  None of the choices are true. 
A)  Chloe's adjusted gross estate is at least $12,020,000. 
B)  Chloe's taxable estate is at least $12,020,000. 
C)  Chloe's taxable estate is $12,050,000. 
D)  Chloe's estate will calculate the tentative estate tax on $12.5 million. 
E)  None of the choices are true.

Question 6

A gratuitous transfer of cash made directly to an individual who uses the entire amount of the cash to pay medical expenses is not subject to a gift tax.

Accepted Answer

A) True 
 B)False

Question 7

Jonathan transferred $90,000 of cash to a trust this year for the benefit of Hannah, age 10. The trustee has the discretion to distribute income or corpus (principal) for Hannah's benefit and is required to distribute all assets to Hannah (or her estate) not later than Hannah's 21 st birthday. What is the amount of the taxable gift?

Accepted Answer

A)  $90,000. 
B)  $75,000. 
C)  $64,000. 
D)  zero-there is no complete gift until the trustee makes a distribution from the trust. 
E)  None of the choices are correct. 
A)  $90,000. 
B)  $75,000. 
C)  $64,000. 
D)  zero-there is no complete gift until the trustee makes a distribution from the trust. 
E)  None of the choices are correct.

Question 8

The applicable credit is designed to:

Accepted Answer

A)  apply only to taxable transfers included in the gross estate. 
B)  prevent taxation of cumulative transfers that do not exceed a certain minimum amount. 
C)  apply to amounts not already eliminated by the exemption equivalent. 
D)  exclude up to $15,000 per individual per year on any individual transfer. 
E)  None of the choices are correct. 
A)  apply only to taxable transfers included in the gross estate. 
B)  prevent taxation of cumulative transfers that do not exceed a certain minimum amount. 
C)  apply to amounts not already eliminated by the exemption equivalent. 
D)  exclude up to $15,000 per individual per year on any individual transfer. 
E)  None of the choices are correct.

Question 9

Which of the following statements is (are) true for both gratuitous and testamentary transfers?

Accepted Answer

A)  An applicable credit of up to $15,000 per donee per year reduces the tax on any transfer. 
B)  An annual exclusion offsets any transfer up to $15,000. 
C)  An election can be made to split a transfer between spouses. 
D)  A charitable and a marital deduction are allowed in computing the taxable transfer. 
E)  All of the choices are true. 
A)  An applicable credit of up to $15,000 per donee per year reduces the tax on any transfer. 
B)  An annual exclusion offsets any transfer up to $15,000. 
C)  An election can be made to split a transfer between spouses. 
D)  A charitable and a marital deduction are allowed in computing the taxable transfer. 
E)  All of the choices are true.

Question 10

Christopher's residence was damaged by a storm during the administration of his estate. Christopher's executor paid $120,000 to repair the residence after the storm. Which of the following is a true statement?

Accepted Answer

A)  A casualty loss of $120,000 can be deducted on Christopher's final individual income tax return. 
B)  The casualty loss deduction is limited to the loss in excess of 10 percent of Christopher's AGI. 
C)  Christopher's executor can deduct a loss of $120,000 on the estate tax return. 
D)  No casualty loss deduction is available for calculating the estate tax. 
E)  None of the choices are true. 
A)  A casualty loss of $120,000 can be deducted on Christopher's final individual income tax return. 
B)  The casualty loss deduction is limited to the loss in excess of 10 percent of Christopher's AGI. 
C)  Christopher's executor can deduct a loss of $120,000 on the estate tax return. 
D)  No casualty loss deduction is available for calculating the estate tax. 
E)  None of the choices are true.

Question 11

The annual exclusion eliminates relatively small transfers of present interests in property.

Accepted Answer

A) True 
 B)False

Question 12

Property is included in the gross estate at the value a willing buyer would pay a willing seller, neither being under any compulsion to buy or to sell, and both having reasonable knowledge of the relevant facts.

Accepted Answer

A) True 
 B)False

Question 13

This year Don and his son purchased real estate for an investment. The price of the property was $500,000, and the title named Don and his son as joint tenants with the right of survivorship. Don provided $320,000 of the purchase price and his son provided the remaining $180,000. Has Don made a taxable gift and, if so, in what amount?

Accepted Answer

A)  Don has made a taxable gift of $205,000. 
B)  Don has made a taxable gift of $70,000. 
C)  Don has made a taxable gift of $22,000. 
D)  Don has made a taxable gift of $55,000. 
E)  None of the choices are correct-Don did not make a taxable gift. 
A)  Don has made a taxable gift of $205,000. 
B)  Don has made a taxable gift of $70,000. 
C)  Don has made a taxable gift of $22,000. 
D)  Don has made a taxable gift of $55,000. 
E)  None of the choices are correct-Don did not make a taxable gift.

Question 14

For the holidays, Samuel gave a necklace worth $35,250 to Jennifer and jewelry worth $57,000 to Savannah. Samuel is married to Wendy and they live in a community-property state. Has Samuel made any taxable gifts and, if so, in what amounts?

Accepted Answer

${{[a(3)]:#,###}} and ${{[a(4)]:#,###}}.

Question 15

Which of the following transfers is a complete gift?

Accepted Answer

A)  Payment of child support by a former spouse. 
B)  Transfer of property to a revocable trust. 
C)  Transfer of cash to a bank account held in joint tenancy with the right of survivorship. 
D)  Income paid to the beneficiary of a revocable trust. 
E)  None of the choices is a complete gift. 
A)  Payment of child support by a former spouse. 
B)  Transfer of property to a revocable trust. 
C)  Transfer of cash to a bank account held in joint tenancy with the right of survivorship. 
D)  Income paid to the beneficiary of a revocable trust. 
E)  None of the choices is a complete gift.

Question 16

Harold and Mary are married and live in a community-property state. During the marriage Harold bought a parcel of real estate for $200,000 in community funds and titled the property in his name alone. Mary died on January 30th of this year and was survived by Harold, who did not remarry. The parcel of real property was worth $390,000 on January 30th of this year but was only worth $330,000 at year-end. What amount, if any, is included in Mary's gross estate?

Accepted Answer

A)  $390,000. 
B)  $330,000. 
C)  $195,000. 
D)  $165,000. 
E)  zero-Mary had no ownership interest in the property at her death. 
A)  $390,000. 
B)  $330,000. 
C)  $195,000. 
D)  $165,000. 
E)  zero-Mary had no ownership interest in the property at her death.

Question 17

Caleb transferred $115,000 to an irrevocable trust for Avery. The trustee has the discretion to distribute income or corpus for Avery's benefit but is required to distribute all assets to Avery (or his estate) not later than Avery's 21 st birthday. What is the amount, if any, of the taxable gift?

Accepted Answer

$100,000.
Caleb will be entitled to an a

Question 18

A terminable interest in property is any interest that terminates during the current year.

Accepted Answer

A) True 
 B)False

Question 19

At his death Jose owned real estate worth $22 million but subject to a mortgage of $7 million. Which of the following is a true statement?

Accepted Answer

A)  $22 million is included in Jose's gross estate. 
B)  $15 million is included in Jose's gross estate. 
C)  The $7 million mortgage must be paid by Jose's estate. 
D)  The $7 million mortgage is not deductible if Jose's will transfers the property to a charity. 
E)  All of the choices are correct. 
A)  $22 million is included in Jose's gross estate. 
B)  $15 million is included in Jose's gross estate. 
C)  The $7 million mortgage must be paid by Jose's estate. 
D)  The $7 million mortgage is not deductible if Jose's will transfers the property to a charity. 
E)  All of the choices are correct.

Question 20

Ricardo transferred $1,225,000 of cash to State University for a new sports complex. Calculate the amount of the taxable gift.

Accepted Answer

Zero.
The gift qualifies for an annual e

Property inherited from a decedent has an adjusted basis equal to the value of the property included in the decedent's estate.

For the holidays, Samuel gave a necklace worth $35,000 to Jennifer and jewelry worth $44,000 to Savannah. Samuel is married to Wendy and they live in a community-property state. Has Samuel made any taxable gifts and, if so, in what amounts?

At her death Siena owned real estate worth $200,000 that was titled with her sister in joint tenancy with the right of survivorship. Siena contributed $50,000 to the total cost of the property and her sister contributed the remaining $75,000. What amount, if any, is included in Siena's gross estate?

Chloe's gross estate consists of the following property valued at the date of death: Chloe's real estate is encumbered by a mortgage of $450,000, and Chloe's executor paid her funeral costs of $6,000 and charged fees for $24,000. Which of the following is a true statement?

A gratuitous transfer of cash made directly to an individual who uses the entire amount of the cash to pay medical expenses is not subject to a gift tax.

The applicable credit is designed to:

Which of the following statements is (are) true for both gratuitous and testamentary transfers?

Christopher's residence was damaged by a storm during the administration of his estate. Christopher's executor paid $120,000 to repair the residence after the storm. Which of the following is a true statement?

The annual exclusion eliminates relatively small transfers of present interests in property.

Property is included in the gross estate at the value a willing buyer would pay a willing seller, neither being under any compulsion to buy or to sell, and both having reasonable knowledge of the relevant facts.

For the holidays, Samuel gave a necklace worth $35,250 to Jennifer and jewelry worth $57,000 to Savannah. Samuel is married to Wendy and they live in a community-property state. Has Samuel made any taxable gifts and, if so, in what amounts?

Which of the following transfers is a complete gift?

Caleb transferred $115,000 to an irrevocable trust for Avery. The trustee has the discretion to distribute income or corpus for Avery's benefit but is required to distribute all assets to Avery (or his estate) not later than Avery's 21 ^st birthday. What is the amount, if any, of the taxable gift?

A terminable interest in property is any interest that terminates during the current year.

At his death Jose owned real estate worth $22 million but subject to a mortgage of $7 million. Which of the following is a true statement?

Ricardo transferred $1,225,000 of cash to State University for a new sports complex. Calculate the amount of the taxable gift.

Business Income, Deductions, and Accounting Methods

Property Acquisition and Cost Recovery

Property Dispositions

Business Entities Overview

Corporate Operations

Accounting for Income Taxes

Corporate Taxation: Non-Liquidating Distributions

Corporate Formation, Reorganization, and Liquidation

Forming and Operating Partnerships

Dispositions of Partnership Interests and Partnership Distributions

S Corporations

State and Local Taxes

The Us Taxation of Multinational Transactions

Filters

Exam 14: Transfer Taxes and Wealth Planning

Property inherited from a decedent has an adjusted basis equal to the value of the property included in the decedent's estate.

For the holidays, Samuel gave a necklace worth $35,000 to Jennifer and jewelry worth $44,000 to Savannah. Samuel is married to Wendy and they live in a community-property state. Has Samuel made any taxable gifts and, if so, in what amounts?

Chloe's gross estate consists of the following property valued at the date of death: Chloe's real estate is encumbered by a mortgage of $450,000, and Chloe's executor paid her funeral costs of $6,000 and charged fees for $24,000. Which of the following is a true statement?

A gratuitous transfer of cash made directly to an individual who uses the entire amount of the cash to pay medical expenses is not subject to a gift tax.

The applicable credit is designed to:

Which of the following statements is (are) true for both gratuitous and testamentary transfers?

Christopher's residence was damaged by a storm during the administration of his estate. Christopher's executor paid $120,000 to repair the residence after the storm. Which of the following is a true statement?

The annual exclusion eliminates relatively small transfers of present interests in property.

Property is included in the gross estate at the value a willing buyer would pay a willing seller, neither being under any compulsion to buy or to sell, and both having reasonable knowledge of the relevant facts.

For the holidays, Samuel gave a necklace worth $35,250 to Jennifer and jewelry worth $57,000 to Savannah. Samuel is married to Wendy and they live in a community-property state. Has Samuel made any taxable gifts and, if so, in what amounts?

Which of the following transfers is a complete gift?

Caleb transferred $115,000 to an irrevocable trust for Avery. The trustee has the discretion to distribute income or corpus for Avery's benefit but is required to distribute all assets to Avery (or his estate) not later than Avery's 21 st birthday. What is the amount, if any, of the taxable gift?

A terminable interest in property is any interest that terminates during the current year.

At his death Jose owned real estate worth $22 million but subject to a mortgage of $7 million. Which of the following is a true statement?

Ricardo transferred $1,225,000 of cash to State University for a new sports complex. Calculate the amount of the taxable gift.

Business Income, Deductions, and Accounting Methods

Property Acquisition and Cost Recovery

Property Dispositions

Business Entities Overview

Corporate Operations

Accounting for Income Taxes

Corporate Taxation: Non-Liquidating Distributions

Corporate Formation, Reorganization, and Liquidation

Forming and Operating Partnerships

Dispositions of Partnership Interests and Partnership Distributions

S Corporations

State and Local Taxes

The Us Taxation of Multinational Transactions

Filters

Caleb transferred $115,000 to an irrevocable trust for Avery. The trustee has the discretion to distribute income or corpus for Avery's benefit but is required to distribute all assets to Avery (or his estate) not later than Avery's 21 ^st birthday. What is the amount, if any, of the taxable gift?