CANNON CTFA REVIEW SHEET 2026
FULL QUESTIONS AND ACCURATE
ANSWERS
◉ Once a will is properly drafted it is valid:
A. in all states.
B. for the state for which it was prepared.
C. in all states for a period of 5 years.
D. for the state for which it was prepared for a period of 5 years..
Answer: B. for the state for which it was prepared.
◉ In managing personal trust assets, a trustee should seek which of the
following?
A. maximum income
B. preservation of capital
C. reasonable income and preservation of capital, including purchasing
power
D. maximum income and reasonable preservation of capital. Answer: C.
reasonable income and preservation of capital including purchasing
power
,◉ A decedent's estate being settled by your bank contains an antique
automobile. One of the directors of your bank indicates that he would
like to buy it. You should do which of the following?
A. Sell it to him at a bargain price and befriend him.
B. Have a qualified appraisal done and offer it to him at that value.
C. Explain that he may not purchase the car from the estate.
D. Arrange for a public auction at which he may buy it if he is the
highest bidder.. Answer: C. Explain that he may not purchase the car
from the estate.
◉ If you hold a rental property in an irrevocable trust, when is it all right
to rent to an employee of your trust department?
A. Never
B. When the employee pays fair rent.
C. When the employee has been with you at least 5 years and can be
trusted.
D. When the employee has no connection with the account or
beneficiaries.. Answer: A. Never
◉ Which of the following generally may NOT hold real property?
A. Revocable Living Trusts trusteed by a corporate fiduciary.
B. Uniform Gift to Minors Account
,C. 2503(c) Minors Trust
D. Uniform Transfer to Minors Account. Answer: B. Uniform Gifts to
Minors Account
◉ H's will provides that upon his death, $1 million will be held in a trust
for the benefit of his wife, W. This trust provides that W will receive all
of the trust income and will receive distributions of principal int he form
of an annuity for her lifetime. At W's death, the remaining trust assets
will be distributed to a designated charity. H's executor intends to make
a "QTIP" election for this trust. Will the legacy to the trust, or any part
thereof, be deductible by H's estate, or if so, why?
A. Yes, the entire $1 million will qualify for the estate tax marital and
charitable deductions.
B. No, none of the $1 million will qualify for the estate tax marital and
charitable deductions.
C. Yes, the entire $1 million will qualify for the estate tax marital
deduction.
D. Yes, the value of W's income interest will qualify for the marital
deduction; the remainder will not qualify for any deduction.. Answer: C.
Yes, the entire $1 million will qualify for the estate tax marital
deduction.
◉ H makes a gift of property to a trust for the benefit of his children. If
H serves as a trustee, what limitations, if any, should be placed on his
distribution powers in order to avoid adverse gift and estate tax
consequences?
, A. H's power to make distributions should be limited by ascertainable
standards such as health, support and education.
B. No limitations are required.
C. H should be prohibited from participating in making any
distributions.
D. H's power to make distributions should be limited to those required to
discharge his legal obligation to support his children.. Answer: A. H's
power to make distributions should be limited by ascertainable standards
such as health, support and education.
◉ Which of the following statements about a QTIP trust is false?
A. An executor has the ability to elect, partially elect, or not elect to
qualify for QTIP treatment any part of the marital trust property.
B. The spouse-beneficiary need not have the ability to control the
ultimate disposition of the trust property.
C. The grantor-spouse's GST exemption cannot be allocated to trust
property.
D. To have a valid QTIP interest, the spouse must be entitled to all of the
net income from the trust property.. Answer: C. The grantor-spouse's
GST exemption cannot be allocated to trust property.
◉ Which of the following is an advantage of a QTIP trust over the life
estate/general power of appointment trust?
A. The surviving spouse will not be entitled to all of the income from the
trust.
FULL QUESTIONS AND ACCURATE
ANSWERS
◉ Once a will is properly drafted it is valid:
A. in all states.
B. for the state for which it was prepared.
C. in all states for a period of 5 years.
D. for the state for which it was prepared for a period of 5 years..
Answer: B. for the state for which it was prepared.
◉ In managing personal trust assets, a trustee should seek which of the
following?
A. maximum income
B. preservation of capital
C. reasonable income and preservation of capital, including purchasing
power
D. maximum income and reasonable preservation of capital. Answer: C.
reasonable income and preservation of capital including purchasing
power
,◉ A decedent's estate being settled by your bank contains an antique
automobile. One of the directors of your bank indicates that he would
like to buy it. You should do which of the following?
A. Sell it to him at a bargain price and befriend him.
B. Have a qualified appraisal done and offer it to him at that value.
C. Explain that he may not purchase the car from the estate.
D. Arrange for a public auction at which he may buy it if he is the
highest bidder.. Answer: C. Explain that he may not purchase the car
from the estate.
◉ If you hold a rental property in an irrevocable trust, when is it all right
to rent to an employee of your trust department?
A. Never
B. When the employee pays fair rent.
C. When the employee has been with you at least 5 years and can be
trusted.
D. When the employee has no connection with the account or
beneficiaries.. Answer: A. Never
◉ Which of the following generally may NOT hold real property?
A. Revocable Living Trusts trusteed by a corporate fiduciary.
B. Uniform Gift to Minors Account
,C. 2503(c) Minors Trust
D. Uniform Transfer to Minors Account. Answer: B. Uniform Gifts to
Minors Account
◉ H's will provides that upon his death, $1 million will be held in a trust
for the benefit of his wife, W. This trust provides that W will receive all
of the trust income and will receive distributions of principal int he form
of an annuity for her lifetime. At W's death, the remaining trust assets
will be distributed to a designated charity. H's executor intends to make
a "QTIP" election for this trust. Will the legacy to the trust, or any part
thereof, be deductible by H's estate, or if so, why?
A. Yes, the entire $1 million will qualify for the estate tax marital and
charitable deductions.
B. No, none of the $1 million will qualify for the estate tax marital and
charitable deductions.
C. Yes, the entire $1 million will qualify for the estate tax marital
deduction.
D. Yes, the value of W's income interest will qualify for the marital
deduction; the remainder will not qualify for any deduction.. Answer: C.
Yes, the entire $1 million will qualify for the estate tax marital
deduction.
◉ H makes a gift of property to a trust for the benefit of his children. If
H serves as a trustee, what limitations, if any, should be placed on his
distribution powers in order to avoid adverse gift and estate tax
consequences?
, A. H's power to make distributions should be limited by ascertainable
standards such as health, support and education.
B. No limitations are required.
C. H should be prohibited from participating in making any
distributions.
D. H's power to make distributions should be limited to those required to
discharge his legal obligation to support his children.. Answer: A. H's
power to make distributions should be limited by ascertainable standards
such as health, support and education.
◉ Which of the following statements about a QTIP trust is false?
A. An executor has the ability to elect, partially elect, or not elect to
qualify for QTIP treatment any part of the marital trust property.
B. The spouse-beneficiary need not have the ability to control the
ultimate disposition of the trust property.
C. The grantor-spouse's GST exemption cannot be allocated to trust
property.
D. To have a valid QTIP interest, the spouse must be entitled to all of the
net income from the trust property.. Answer: C. The grantor-spouse's
GST exemption cannot be allocated to trust property.
◉ Which of the following is an advantage of a QTIP trust over the life
estate/general power of appointment trust?
A. The surviving spouse will not be entitled to all of the income from the
trust.
