Question 1

For estate tax purposes, what is the difference between a surviving spouse's share of the community property and a dower (or courtesy) interest?

Accepted Answer

A surviving spouse's portion of the comm

Question 2

At the time of her death in 2011, Amber owns property worth $4,000,000. Other information regarding her affairs is as follows.
   All of these items (except the casualty loss) were paid by her estate and none were deducted on Form 1041 (income tax return of the estate). What is Amber's taxable estate?

Accepted Answer

$3,150,000. $4,000,000 (gross estate) -

Question 3

Paul, a U.S. citizen, will avoid the Federal estate tax if he becomes a Canadian resident and owns no property located in the U.S. at the time of his death.

Accepted Answer

A) True 
 B)False

Question 4

Reba purchases U.S. savings bonds which she lists in the name of Rod, Reba's son. The purchase of the bonds does not constitute a gift.

Accepted Answer

A) True 
 B)False

Question 5

Using his separate funds, Wilbur purchases an annuity which pays him a specified amount until death. Upon Wilbur's prior death, a reduced amount is to be paid to Marcia for her life. Marcia predeceases Wilbur. Nothing concerning the annuity contract is included in Marcia's gross estate.

Accepted Answer

A) True 
 B)False

Question 6

In contrasting the computation of the Federal gift and estate taxes, are past taxable gifts handled in the same fashion? Explain.

Accepted Answer

In determining the gift tax ba

Question 7

In which, if any, of the following independent situations has Fred made a gift?

Accepted Answer

A)  Fred established a revocable trust, income payable to himself for life and, upon his death, remainder to his children. 
B)  Fred dies owning a U.S. savings bond with ownership listed as: "Fred, payable to Sue on Fred's death." Sue redeems the bond. 
C)  Fred sends $25,000 to Alice's oral surgeon in payment of her dental implants. Alice is Fred's sister and does not qualify as his dependent. 
D)  Fred pays Eva $800,000 in a property settlement of her marital rights. One month later Fred and Eva are divorced. 
E)  None of the above. 
A)  Fred established a revocable trust, income payable to himself for life and, upon his death, remainder to his children. 
B)  Fred dies owning a U.S. savings bond with ownership listed as: "Fred, payable to Sue on Fred's death." Sue redeems the bond. 
C)  Fred sends $25,000 to Alice's oral surgeon in payment of her dental implants. Alice is Fred's sister and does not qualify as his dependent. 
D)  Fred pays Eva $800,000 in a property settlement of her marital rights. One month later Fred and Eva are divorced. 
E)  None of the above.

Question 8

By his will, all of Rusty's property passes outright to his wife, Patsy. As Patsy was not given a general power of appointment or Rusty's executor did not make a QTIP election, Rusty's estate is not allowed a marital deduction.

Accepted Answer

A) True 
 B)False

Question 9

A Federal gift tax return may have to be filed even if no gift tax is payable.

Accepted Answer

A) True 
 B)False

Question 10

Sandy pays a local college for her non-dependent boyfriend's tuition. The payment is not subject to the Federal gift tax.

Accepted Answer

A) True 
 B)False

Question 11

Eric dies at age 96 and is survived by his third wife, Monique (age 22), and a granddaughter, Paula (age 50). Eric's will divides his $11 million estate between these two survivors. Both of these transfers are subject to the generation skipping transfer tax (GSTT).

Accepted Answer

A) True 
 B)False

Question 12

The current top Federal transfer tax rate of 35% is the highest that the rate ever has been.

Accepted Answer

A) True 
 B)False

Question 13

At the time of his death, Norton was involved in the following transactions.   What amount is included in Norton's gross estate?

Accepted Answer

A)  $700,000. 
B)  $900,000. 
C)  $1,100,000. 
D)  $1,500,000. 
E)  None of the above. 
A)  $700,000. 
B)  $900,000. 
C)  $1,100,000. 
D)  $1,500,000. 
E)  None of the above.

Question 14

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

Accepted Answer

A) True 
 B)False

Question 15

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

Accepted Answer

A)  The alternate valuation date of § 2032 can be elected. 
B)  A charitable deduction is available. 
C)  A disclaimer procedure may avoid the tax. 
D)  A marital deduction is available. 
E)  None of the above. 
A)  The alternate valuation date of § 2032 can be elected. 
B)  A charitable deduction is available. 
C)  A disclaimer procedure may avoid the tax. 
D)  A marital deduction is available. 
E)  None of the above.

Question 16

José, a citizen and resident of Panama, makes a gift of ExxonMobil stock to his children. Because ExxonMobil is a U.S. corporation, José will be subject to the U.S. Federal gift tax.

Accepted Answer

A) True 
 B)False

Question 17

To avoid the terminable interest limitation on the marital deduction, the surviving spouse must be granted a general power of appointment over the trust property, and a QTIP election must be made.

Accepted Answer

A) True 
 B)False

Question 18

Harry and Brenda are husband and wife. Using his funds, Harry purchases real estate which he lists as: "Harry and Brenda, tenants by the entirety with right of survivorship." If Brenda dies first, none of the value of the real estate will be included in her gross estate.

Accepted Answer

A) True 
 B)False

Question 19

Some of the charitable organizations that qualify for estate tax purposes do not qualify for income tax purposes.

Accepted Answer

A) True 
 B)False

Question 20

One of the reasons the estate tax was enacted was to prevent the avoidance of the gift tax by the making of "deathbed gifts."

Accepted Answer

A) True 
 B)False

For estate tax purposes, what is the difference between a surviving spouse's share of the community property and a dower (or courtesy) interest?

At the time of her death in 2011, Amber owns property worth $4,000,000. Other information regarding her affairs is as follows. All of these items (except the casualty loss) were paid by her estate and none were deducted on Form 1041 (income tax return of the estate). What is Amber's taxable estate?

Paul, a U.S. citizen, will avoid the Federal estate tax if he becomes a Canadian resident and owns no property located in the U.S. at the time of his death.

Reba purchases U.S. savings bonds which she lists in the name of Rod, Reba's son. The purchase of the bonds does not constitute a gift.

Using his separate funds, Wilbur purchases an annuity which pays him a specified amount until death. Upon Wilbur's prior death, a reduced amount is to be paid to Marcia for her life. Marcia predeceases Wilbur. Nothing concerning the annuity contract is included in Marcia's gross estate.

In contrasting the computation of the Federal gift and estate taxes, are past taxable gifts handled in the same fashion? Explain.

In which, if any, of the following independent situations has Fred made a gift?

By his will, all of Rusty's property passes outright to his wife, Patsy. As Patsy was not given a general power of appointment or Rusty's executor did not make a QTIP election, Rusty's estate is not allowed a marital deduction.

A Federal gift tax return may have to be filed even if no gift tax is payable.

Sandy pays a local college for her non-dependent boyfriend's tuition. The payment is not subject to the Federal gift tax.

Eric dies at age 96 and is survived by his third wife, Monique (age 22), and a granddaughter, Paula (age 50). Eric's will divides his $11 million estate between these two survivors. Both of these transfers are subject to the generation skipping transfer tax (GSTT).

The current top Federal transfer tax rate of 35% is the highest that the rate ever has been.

At the time of his death, Norton was involved in the following transactions. What amount is included in Norton's gross estate?

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

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

José, a citizen and resident of Panama, makes a gift of ExxonMobil stock to his children. Because ExxonMobil is a U.S. corporation, José will be subject to the U.S. Federal gift tax.

To avoid the terminable interest limitation on the marital deduction, the surviving spouse must be granted a general power of appointment over the trust property, and a QTIP election must be made.

Harry and Brenda are husband and wife. Using his funds, Harry purchases real estate which he lists as: "Harry and Brenda, tenants by the entirety with right of survivorship." If Brenda dies first, none of the value of the real estate will be included in her gross estate.

Some of the charitable organizations that qualify for estate tax purposes do not qualify for income tax purposes.

One of the reasons the estate tax was enacted was to prevent the avoidance of the gift tax by the making of "deathbed gifts."

Understanding and Working With the Federal Tax Law

Corporations: Introduction and Operating Rules

Corporations: Special Situations

Corporations: Organization and Capital Structure

Corporations: Earnings Profits and Dividend Distributions

Corporations: Redemptions and Liquidations

Corporations: Reorganizations

Consolidated Tax Returns

Taxation of International Transactions

Partnerships: Formation, Operation, and Basis

Partnerships: Distributions, Transfer of Interests, and Terminations

S: Corporations

Comparative Forms of Doing Business

Taxes on the Financial Statements

Exempt Entities

Multistate Corporate Taxation

Tax Practice and Ethics

Family Tax Planning

Income Taxation of Trusts and Estates

Filters

Exam 18: The Federal Gift and Estate Taxes

For estate tax purposes, what is the difference between a surviving spouse's share of the community property and a dower (or courtesy) interest?

At the time of her death in 2011, Amber owns property worth $4,000,000. Other information regarding her affairs is as follows. All of these items (except the casualty loss) were paid by her estate and none were deducted on Form 1041 (income tax return of the estate). What is Amber's taxable estate?

Paul, a U.S. citizen, will avoid the Federal estate tax if he becomes a Canadian resident and owns no property located in the U.S. at the time of his death.

Reba purchases U.S. savings bonds which she lists in the name of Rod, Reba's son. The purchase of the bonds does not constitute a gift.

Using his separate funds, Wilbur purchases an annuity which pays him a specified amount until death. Upon Wilbur's prior death, a reduced amount is to be paid to Marcia for her life. Marcia predeceases Wilbur. Nothing concerning the annuity contract is included in Marcia's gross estate.

In contrasting the computation of the Federal gift and estate taxes, are past taxable gifts handled in the same fashion? Explain.

In which, if any, of the following independent situations has Fred made a gift?

By his will, all of Rusty's property passes outright to his wife, Patsy. As Patsy was not given a general power of appointment or Rusty's executor did not make a QTIP election, Rusty's estate is not allowed a marital deduction.

A Federal gift tax return may have to be filed even if no gift tax is payable.

Sandy pays a local college for her non-dependent boyfriend's tuition. The payment is not subject to the Federal gift tax.

Eric dies at age 96 and is survived by his third wife, Monique (age 22), and a granddaughter, Paula (age 50). Eric's will divides his $11 million estate between these two survivors. Both of these transfers are subject to the generation skipping transfer tax (GSTT).

The current top Federal transfer tax rate of 35% is the highest that the rate ever has been.

At the time of his death, Norton was involved in the following transactions. What amount is included in Norton's gross estate?

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

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

José, a citizen and resident of Panama, makes a gift of ExxonMobil stock to his children. Because ExxonMobil is a U.S. corporation, José will be subject to the U.S. Federal gift tax.

To avoid the terminable interest limitation on the marital deduction, the surviving spouse must be granted a general power of appointment over the trust property, and a QTIP election must be made.

Harry and Brenda are husband and wife. Using his funds, Harry purchases real estate which he lists as: "Harry and Brenda, tenants by the entirety with right of survivorship." If Brenda dies first, none of the value of the real estate will be included in her gross estate.

Some of the charitable organizations that qualify for estate tax purposes do not qualify for income tax purposes.

One of the reasons the estate tax was enacted was to prevent the avoidance of the gift tax by the making of "deathbed gifts."

Understanding and Working With the Federal Tax Law

Corporations: Introduction and Operating Rules

Corporations: Special Situations

Corporations: Organization and Capital Structure

Corporations: Earnings Profits and Dividend Distributions

Corporations: Redemptions and Liquidations

Corporations: Reorganizations

Consolidated Tax Returns

Taxation of International Transactions

Partnerships: Formation, Operation, and Basis

Partnerships: Distributions, Transfer of Interests, and Terminations

S: Corporations

Comparative Forms of Doing Business

Taxes on the Financial Statements

Exempt Entities

Multistate Corporate Taxation

Tax Practice and Ethics

Family Tax Planning

Income Taxation of Trusts and Estates

Filters