HS 330 test 1 questions with correct
answers
Which of the following terms refers to the property of a decedent
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reverting to his or her state of domicile when he or she has no surviving
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relatives?
(A) intestate
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(B) succession
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(C) apportionment
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(D) escheat - CORRECT ANSWER✔✔-(D) escheat
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(A), (B), and (C) are incorrect because, although those terms refer to a
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decedent's property passing at death, they do not pertain to property
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reverting to a decedent's state of domicile when he or she has no
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surviving relatives. |
Which of the following interests in real property gives the owner of the
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interest the most control over the property?
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(A) a life estate
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,(B) a remainder interest
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(C) a retained interest
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(D) a fee simple estate - CORRECT ANSWER✔✔-(D) a fee simple estate
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(A), (B), and (C) are incorrect because they involve limitations on the
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holder's property interest. The holder of a life estate, remainder
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interest, or retained interest does not own the property in all events
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since some possessory term in the property belongs to another interest
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holder.
A wife owns a $100,000 whole life insurance policy on her husband's
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life. She has named her son as revocable beneficiary. Which of the
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following statements concerning the life insurance is correct?
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(A) If the wife dies before her husband and bequests the policy to him
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upon her death, the transfer will qualify for the marital deduction.
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(B) The annual premium payments by the wife are gifts to her son.
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(C) If the husband dies before the wife, the wife will have made a gift to
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her son equal to the difference between the interpolated terminal
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reserve and the face amount of the policy.
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(D) If the wife dies before the husband, the value of the policy will be
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excludible from her estate. - CORRECT ANSWER✔✔-(A) If the wife dies
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before her husband and bequests the policy to him upon her death, the
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transfer will qualify for the marital deduction.
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,A is correct because it is a present transfer to the husband at death and
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not subject to any terminable interest, as such the value of the policy
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qualifies for the marital deduction. (B) is incorrect because the gift is
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incomplete until the husband dies. (C) is incorrect because the gift is
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valued at the entire amount of the death benefit. (D) is incorrect
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because the policy is owned by the wife, and it will be property
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considered includible in her estate if she dies before her husband.
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In 2016 a wife makes outright gifts of $98,000 to her son, and her
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husband agrees to split the gifts with her. Which of the following
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correctly states the amount of the taxable gifts?
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(A) wife $25,000, husband $45,000
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(B) wife $35,000, husband $35,000
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(C) wife $49,000, husband $49,000
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(D) wife $84,000, husband $0 - CORRECT ANSWER✔✔-(B) wife $35,000,
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husband $35,000 |
The calculation of taxable gifts is as follows: Total gifts, less annual
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exclusion = total taxable gifts. Wife: $49,000 - $14,000 = $35,000.
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Husband: $49,000 - $14,000 = $35,000.| | | | |
, Which of the following items is a deduction from a decedent's gross
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estate in determining the adjusted gross estate?
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(A) foreign death taxes
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(B) state excise taxes
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(C) claims against the estate
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(D) the marital deduction - CORRECT ANSWER✔✔-(C) claims against the
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estate
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(A) and (B) are incorrect because foreign death taxes and state excise
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taxes are not a deduction against the gross estate. (D) is incorrect
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because the marital deduction is a deduction against the adjusted gross
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estate to determine the taxable estate.
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Income earned but unpaid at the time of a decedent's death is deemed
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to be income in respect of a decedent (IRD). Which of the following
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statements concerning IRD is correct? | | | |
(A) The income must be reported on the decedent's final federal income
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tax return.
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(B) The income is taxable to the person or entity receiving it.
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(C) IRD includes income earned by the executor on estate assets.
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answers
Which of the following terms refers to the property of a decedent
| | | | | | | | | | | |
reverting to his or her state of domicile when he or she has no surviving
| | | | | | | | | | | | | | |
relatives?
(A) intestate
|
(B) succession
|
(C) apportionment
|
(D) escheat - CORRECT ANSWER✔✔-(D) escheat
| | | | |
(A), (B), and (C) are incorrect because, although those terms refer to a
| | | | | | | | | | | | |
decedent's property passing at death, they do not pertain to property
| | | | | | | | | | |
reverting to a decedent's state of domicile when he or she has no
| | | | | | | | | | | | |
surviving relatives. |
Which of the following interests in real property gives the owner of the
| | | | | | | | | | | | |
interest the most control over the property?
| | | | | |
(A) a life estate
| | |
,(B) a remainder interest
| | |
(C) a retained interest
| | |
(D) a fee simple estate - CORRECT ANSWER✔✔-(D) a fee simple estate
| | | | | | | | | | |
(A), (B), and (C) are incorrect because they involve limitations on the
| | | | | | | | | | | |
holder's property interest. The holder of a life estate, remainder
| | | | | | | | | |
interest, or retained interest does not own the property in all events
| | | | | | | | | | | |
since some possessory term in the property belongs to another interest
| | | | | | | | | | |
holder.
A wife owns a $100,000 whole life insurance policy on her husband's
| | | | | | | | | | | |
life. She has named her son as revocable beneficiary. Which of the
| | | | | | | | | | | |
following statements concerning the life insurance is correct?
| | | | | | |
(A) If the wife dies before her husband and bequests the policy to him
| | | | | | | | | | | | | |
upon her death, the transfer will qualify for the marital deduction.
| | | | | | | | | |
(B) The annual premium payments by the wife are gifts to her son.
| | | | | | | | | | | |
(C) If the husband dies before the wife, the wife will have made a gift to
| | | | | | | | | | | | | | | |
her son equal to the difference between the interpolated terminal
| | | | | | | | | |
reserve and the face amount of the policy.
| | | | | | |
(D) If the wife dies before the husband, the value of the policy will be
| | | | | | | | | | | | | | |
excludible from her estate. - CORRECT ANSWER✔✔-(A) If the wife dies
| | | | | | | | | | |
before her husband and bequests the policy to him upon her death, the
| | | | | | | | | | | | |
transfer will qualify for the marital deduction.
| | | | | |
,A is correct because it is a present transfer to the husband at death and
| | | | | | | | | | | | | | |
not subject to any terminable interest, as such the value of the policy
| | | | | | | | | | | | |
qualifies for the marital deduction. (B) is incorrect because the gift is
| | | | | | | | | | | |
incomplete until the husband dies. (C) is incorrect because the gift is
| | | | | | | | | | | |
valued at the entire amount of the death benefit. (D) is incorrect
| | | | | | | | | | | |
because the policy is owned by the wife, and it will be property
| | | | | | | | | | | | |
considered includible in her estate if she dies before her husband.
| | | | | | | | | |
In 2016 a wife makes outright gifts of $98,000 to her son, and her
| | | | | | | | | | | | | |
husband agrees to split the gifts with her. Which of the following
| | | | | | | | | | | |
correctly states the amount of the taxable gifts?
| | | | | | |
(A) wife $25,000, husband $45,000
| | | |
(B) wife $35,000, husband $35,000
| | | |
(C) wife $49,000, husband $49,000
| | | |
(D) wife $84,000, husband $0 - CORRECT ANSWER✔✔-(B) wife $35,000,
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husband $35,000 |
The calculation of taxable gifts is as follows: Total gifts, less annual
| | | | | | | | | | | |
exclusion = total taxable gifts. Wife: $49,000 - $14,000 = $35,000.
| | | | | | | | | | |
Husband: $49,000 - $14,000 = $35,000.| | | | |
, Which of the following items is a deduction from a decedent's gross
| | | | | | | | | | | |
estate in determining the adjusted gross estate?
| | | | | |
(A) foreign death taxes
| | |
(B) state excise taxes
| | |
(C) claims against the estate
| | | |
(D) the marital deduction - CORRECT ANSWER✔✔-(C) claims against the
| | | | | | | | |
estate
|
(A) and (B) are incorrect because foreign death taxes and state excise
| | | | | | | | | | | |
taxes are not a deduction against the gross estate. (D) is incorrect
| | | | | | | | | | | |
because the marital deduction is a deduction against the adjusted gross
| | | | | | | | | | |
estate to determine the taxable estate.
| | | | |
Income earned but unpaid at the time of a decedent's death is deemed
| | | | | | | | | | | | |
to be income in respect of a decedent (IRD). Which of the following
| | | | | | | | | | | | |
statements concerning IRD is correct? | | | |
(A) The income must be reported on the decedent's final federal income
| | | | | | | | | | |
tax return.
| |
(B) The income is taxable to the person or entity receiving it.
| | | | | | | | | | |
(C) IRD includes income earned by the executor on estate assets.
| | | | | | | | | |
