Exam 15: Preserving Your Estate

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. The credit shelter trust is also referred to as the [ Crummey | bypass ] trust.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. [ People  | Asset ] planning involves deciding who will receive each item of property included in your estate.

Charitable contributions given during one's lifetime provide an income tax deduction and remove property from the estate.

In 2018, James gave his son John a $5,000,000 term life insurance policy taken on James' life. At the time of the gift, James was in good health, and the value of the term insurance policy for gift tax purposes was less than the $15,000 annual exclusion amount. However, James died in 2019. Which of the following statements is true?

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. If you die with no valid will in existence, and your property goes to the states, the property is said to be [ intestate | escheat ] to the state.

A written and legally enforceable document expressing how a person's property should be distributed on his or her death is known as a(n):

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. A beneficiary of a will [ should |  should not ] serve as a witness to the will.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. The estate tax applies [ only to transfers that a deceased actually makes at death | only to certain transfers made during a person's lifetime ].

The first step of the estate planning process is to list all assets and determine the ownership and value of your estate.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. Federal law permits [ a limited | an unlimited ] deduction for gift tax and estate tax purposes on property given or left to a spouse who is a U.S. citizen.

Which of the following would be a first-level death-related cost?

When the first spouse dies, then any unused applicable exclusion amount (AEA) is lost and cannot be used.

Which of the following statements about the portability of the Unified Transfer Tax Credit (UTTC) is true?

The disposition of property involves:

Jane and Arthur Patrikson are happy that their daughter is graduating from high school. They gift their daughter $25,000, with $12,500 being paid out of Mr. Patrikson's account and the remaining from Mrs. Patrikson's account. What will be the gift tax payable by the Patriksons on account of the above transaction?

A trust that comes into existence only after the will is probated is known as a(n) _____ trust.

A _____ is applied to reduce estate tax when a large amount of real estate is for sale in one area.

Your gross estate includes all property you own that might be subject to federal estate taxes at your death.

_____ is a special form of marital property co-ownership that is found only in common-law states.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. [ Married | Unmarried ] couples have the greater need for estate planning.