Exam 14: Transfer Taxes and Wealth Planning

Adrian owns two parcels of real estate.Parcel #1 is worth $400,000 and Parcel #2 is worth $660,000.Adrian plans to bequeath Parcel #1 directly to his spouse Sofia and leave her a life estate in Parcel #2.What amounts will be included in Adrian's taxable estate for these two parcels?

(Short Answer)

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Question 61

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.

(True/False)

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Question 62

At his death,Stanley owned real estate worth $345,000 with two other individuals as equal tenants in common.Stanley contributed $50,000 to the $100,000 total cost of the property.What amount,if any,is included in Stanley's gross estate?

(Multiple Choice)

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(86)

Question 63

When a gift-splitting election is made,gifts made by either spouse during the year will be treated as if each spouse made one-half of the transfer.

(True/False)

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Question 64

Proceeds of life insurance paid due to the death of the decedent are included in the decedent's gross estate if the decedent had the right to designate the beneficiary of the policy.

(True/False)

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Question 65

Which of the following statements is (are)true?

(Multiple Choice)

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Question 66

A transfer of cash to a bank account held in joint tenancy with the right of survivorship is not a completed gift.

(True/False)

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Question 67

The tax on cumulative taxable gifts is reduced by the applicable credit regardless of whether any applicable credit was used in prior years.

(True/False)

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Question 68

Adjusted taxable gifts are added to the taxable estate to accomplish which of the following objectives?

(Multiple Choice)

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Question 69

The calculation of the value of a life estate in a trust generally does not depend upon which of the following factors?

(Multiple Choice)

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Question 70

Natalie transferred $500,000 of bonds to a revocable trust with directions to the trustee to pay income to her aunt for five years after which the corpus is to be distributed to Natalie's niece.At year end,the trustee paid $15,000 of income to the aunt.Which of the following is a true statement?

(Multiple Choice)

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Question 71

Life insurance is an asset that can be used to fund a trust to support a surviving spouse and,yet,may not be included in the decedent's gross estate.

(True/False)

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(71)

Question 72

The gross estate may contain property transfers that are not included in the probate estate.

(True/False)

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(86)

Question 73

A applicable credit is subtracted in calculating both the gift tax and the estate tax.Why doesn't this calculation have the effect of increasing the total applicable credit amount?

(Multiple Choice)

4.8/5

(71)

Question 74

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?

(Multiple Choice)

4.9/5

(70)

Question 75

Adjusted taxable gifts are included when calculating the taxable estate but are not subject to double taxation because a tax credit is provided for taxes payable on adjusted taxable gifts.

(True/False)

4.8/5

(80)

Question 76

A gratuitous transfer of property made during the lifetime of the donor is called:

(Multiple Choice)

4.8/5

(73)

Question 77

This year Nathan transferred $2 million to an irrevocable trust established for the benefit of his nephew.The trustee is directed to accumulate income for the next 5 years before distributing the trust corpus to Nathan's nephew.In past years Nathan has made taxable gifts of $6 million and used an applicable credit on an exemption equivalent of $5 million.What amount of gift tax,if any,must Nathan remit?

(Multiple Choice)

4.9/5

(91)

Question 78

A bypass provision in a will requires a decedent to have a taxable estate in order to use an applicable credit to reduce total estate taxes on a married couple.

(True/False)

4.9/5

(83)

Question 79

At his death,Tyrone's life insurance policy paid his estate $85,000.What amount,if any,is included in Tyrone's gross estate?

(Multiple Choice)

4.9/5

(83)

Question 80

Showing 61 - 80 of 123

Adrian owns two parcels of real estate.Parcel #1 is worth $400,000 and Parcel #2 is worth $660,000.Adrian plans to bequeath Parcel #1 directly to his spouse Sofia and leave her a life estate in Parcel #2.What amounts will be included in Adrian's taxable estate for these two parcels?

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.

At his death,Stanley owned real estate worth $345,000 with two other individuals as equal tenants in common.Stanley contributed $50,000 to the $100,000 total cost of the property.What amount,if any,is included in Stanley's gross estate?

When a gift-splitting election is made,gifts made by either spouse during the year will be treated as if each spouse made one-half of the transfer.

Proceeds of life insurance paid due to the death of the decedent are included in the decedent's gross estate if the decedent had the right to designate the beneficiary of the policy.

Which of the following statements is (are)true?

A transfer of cash to a bank account held in joint tenancy with the right of survivorship is not a completed gift.

The tax on cumulative taxable gifts is reduced by the applicable credit regardless of whether any applicable credit was used in prior years.

Adjusted taxable gifts are added to the taxable estate to accomplish which of the following objectives?

The calculation of the value of a life estate in a trust generally does not depend upon which of the following factors?

Natalie transferred $500,000 of bonds to a revocable trust with directions to the trustee to pay income to her aunt for five years after which the corpus is to be distributed to Natalie's niece.At year end,the trustee paid $15,000 of income to the aunt.Which of the following is a true statement?

Life insurance is an asset that can be used to fund a trust to support a surviving spouse and,yet,may not be included in the decedent's gross estate.

The gross estate may contain property transfers that are not included in the probate estate.

A applicable credit is subtracted in calculating both the gift tax and the estate tax.Why doesn't this calculation have the effect of increasing the total applicable credit amount?

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?

Adjusted taxable gifts are included when calculating the taxable estate but are not subject to double taxation because a tax credit is provided for taxes payable on adjusted taxable gifts.

A gratuitous transfer of property made during the lifetime of the donor is called:

A bypass provision in a will requires a decedent to have a taxable estate in order to use an applicable credit to reduce total estate taxes on a married couple.

At his death,Tyrone's life insurance policy paid his estate $85,000.What amount,if any,is included in Tyrone's gross estate?

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