1. Which of the following transfer mechanisms would be appropriate for the transfer of Fresh Veggies to James and Elizabeth assuming Madi and Devon did not want to make an outright gift of the company to them?
1. Private Annuity.
2. SCIN.
3. Family Limited Partnership.
4. QPRT.
1 only.
3 only.
1 and 2
1, 2, 3 and 4.
2. If Devon died today, which of the following statements is true regarding the transfers made in his will?
Madi will receive Devon’s interest in the Investment Portfolio.
Elizabeth will receive the proceeds of the life insurance policy.
James will receive the yacht in place of the house boat.
Marie may potentially receive Vacation Home 1 as Lynn’s rightful heir.
3. Assuming Devon died today, calculate his gross estate.
4. Assuming Devon died today, calculate his probate estate.
5. Assuming Devon died today, calculate the marital deduction available for transfers to Madi (remember this is a net amount).
6. Ignoring the data above, Assume that Devon died today and the estate tax due was $702,591 and Keith is appointed executor. Unfortunately, Keith forgot to file an Estate Tax Return (Form 706) and pay the estate tax due until 45 days after the return’s due date. How much is the failure-to-file penalty?
7. Assume Madi and Devon wanted to establish college funds for each of the grandchildren. Which of the following statements would be true?
An irrevocable trust would be a completed gift for gift tax and estate tax purposes.
The transfers would not be subject to GSTT, regardless of to whom the money is paid, because the payments were made for education.
Marie may potentially receive Vacation Home 1 as Lynn’s rightful heir.
3. Assuming Devon died today, calculate his gross estate.
4. Assuming Devon died today, calculate his probate estate.
5. Assuming Devon died today, calculate the marital deduction available for transfers to Madi (remember this is a net amount).
6. Ignoring the data above, Assume that Devon died today and the estate tax due was $702,591 and Keith is appointed executor. Unfortunately, Keith forgot to file an Estate Tax Return (Form 706) and pay the estate tax due until 45 days after the return’s due date. How much is the failure-to-file penalty?
7. Assume Madi and Devon wanted to establish college funds for each of the grandchildren. Which of the following statements would be true?
An irrevocable trust would be a completed gift for gift tax and estate tax purposes.
The transfers would not be subject to GSTT, regardless of to whom the money is paid, because the payments were made for education.
If Devon and Madi found out about Marie and wanted to establish a fund for her as well, then the transfer to Marie would be subject to GSTT.
An appropriate planning technique for both Elizabeth and James’ family would be to place the assets into 2 family trusts, 1 for Elizabeth’s children (with Elizabeth and Scott as joint trustees) and 1 for James’ children (with Catherine as the trustee).
8. Which of the following statements regarding the transfer to Andrew 5 years ago is correct?
Andrew is a skip person because he is more than 37 and ½ years younger than Devon, thus the transfer results in a taxable termination.
The transfer will qualify for the GSTT annual exclusion.
Assuming 2020 rates apply to this transfer, the GSTT will be 40% of $8,000,000.
The only tax consequence for this transfer will be GSTT due.
9. Assuming Madi died today, which of the following statements is true?
Kathi’s assets would avoid probate.
All of Madi’s community property assets would transfer to Devon because of the implied right of survivorship.
State intestacy law would dictate who received Madi’s assets.
Madi’s gross estate would include the life insurance policy on Devon.
10. Assuming Devon died today, which of the following statements regarding a valid disclaimer is correct?
Assume Devon left Elizabeth his interest in the Yacht. If Elizabeth disclaims her property, then the transfer will be subject to GSTT.
If James disclaimed his property, the property would transfer to Kathi.
If Madi wanted to disclaim a portion of the property, she must do so by the due date of the estate tax return plus extensions.
In order for the disclaimer to be valid it must be in writing or witnessed by 3 nonrelated individuals if the disclaimer is oral.
11. Assume Madi died today and left Vacation Home 2 to Elizabeth. What would Elizabeth’s adjusted basis be in Vacation Home 2?
12. Assume Madi died today and left her share of the personal residence to Devon. What would Devon’s adjusted basis be in the personal residence?
13. Madi and Devon are considering making a charitable contribution to the Boys and Girls Club of America and want the grandchildren to receive income from the property for an extended period. Which of the following charitable devices may be appropriate to meet their objectives?
1. Charitable Remainder Annuity Trust
2. Charitable Remainder Unitrust Trust
3. Pooled Income Fund
4. Charitable Lead Trust