Estate Planning Basics WK 10
Which of the following statements regarding property held in a custodial account (UTMA or UGMA) is CORRECT?
A custodial account is generally less costly to create than a trust.
Which of the following statements about estate planning documents is CORRECT?
A durable power of attorney is effective even after the principal's incapacity.
Which of the following is considered community property?
A parcel of real estate, acquired after the marriage with joint funds, titled solely in the husband's name
statements regarding trusts are CORRECT
A revocable trust allows the trust to be changed by the grantor. An inter vivos trust is operative during the grantor's life. A testamentary trust becomes operative on the death of the grantor.
statements regarding trusts are CORRECT except
An irrevocable trust prohibits the grantor from terminating the trust without the approval of the trustee.
Which of these does NOT describe a method of making a gift?
Bequest
Which of the following terms are associated with structuring a will?
Codicil Bequest Personal representative
Which of the following is a medical proxy that authorizes another to make health care decisions on an individual's behalf?
Durable power of attorney for health care
Characteristic of property owned as tenants in common?
Each tenant can possess a different percentage of ownership.
Henry had a will drafted in North Carolina and has now moved to Alabama. Which of the following statements regarding his will is true?
His will is valid in Alabama, but Alabama state statutes may interpret some sections differently than North Carolina.
Which of the following statements regarding the characteristics of intestate succession laws, including state intestacy statutes, is CORRECT?
If there is a surviving spouse and/or children, it is unlikely that other blood relatives of the decedent will receive any of the decedent's property.
a disadvantage of a will?
In common law states, a surviving spouse may be entitled to take more property than the spouse is specifically given through a will.
Which of the following terms is NOT properly associated with structuring a will?
Intestate
an advantage of creating a will?
It can be used to establish a testamentary trust. May reduce estate taxes by making transfers that qualify for the charitable deduction
Which of the following acts regarding digital assets addresses fiduciary access to electronic communications such email and texts?
None of the laws govern electronic communications.
Which of these statements concerning the $15,000 (2021) annual gift tax exclusion amount is CORRECT?
One may gift up to $15,000 to each of an unlimited number of individuals and still be able to claim an exclusion from gift taxes. there is no limit to the number of individuals that one may give gifts to using the annual exclusion.
Which of the following is NOT considered community property?
Property inherited by a spouse from her parents during the marriage Property gifted to a spouse from his aunt during the marriage Bank accounts, owned separately by spouses, holding income earned by each spouse before marriage
Which of the following assets would receive either a full or partial basis step up (or step down) in an estate?
Real estate held as tenants in common with a sibling Sole owner of a bond fund Stock held as joint tenants with right of survivorship with a spouse
Which of the following assets would NOT receive either a full or partial basis step up (or step down) in an estate?
Stock held in a traditional IRA account
Which of the following statements regarding the federal gift tax annual exclusion is CORRECT?
The annual exclusion is generally only allowed for gifts of a present interest.
Which of these statements regarding federal gift and estate taxes is CORRECT?
The federal gift and estate tax share a common tax rate table.
Which of the following statements regarding property held as tenants by the entirety is CORRECT?
The interest of a deceased tenant passes by right of survivorship outside of the probate process. Tenants must be married to each other.
Which of the following statements regarding estate planning is CORRECT?
Titling of assets is an important part of the estate planning process. because it dictates who receives the deceased's share or determines that the deceased's share will be distributed, as decided by the probate process.
Which of the following allows for an unlimited deduction for gift and estate tax purposes?
Transfer from a U.S. citizen spouse to a U.S. citizen spouse and a qualified charity
The same person can be the grantor, trustee, and beneficiary of a trust. T/F?
True
Which of the following is an advantage of trusts when planning for incapacity?
Trusts and the authority of a trustee are routinely accepted by financial institutions.
Common types of custodial accounts for minors?
UGMA UTMA
a bequest is
a transfer of property made by a will after the owner is deceased
The purpose of a codicil is to
amend an existing will.
Revised Uniform Fiduciary Access to Digital Assets Act (RUFADAA)
extends the fiduciary duty to cover digital assets such as computer files, websites, and cryptocurrency. It does not allow the fiduciary access to electronic communications like email, text messages, and social media accounts unless expressly stated by the owner of those in a will, trust, power of attorney, or other record.
To be eligible for Medicaid, an applicant must meet both
medical and financial criteria The applicant must need nursing home care and must have limited resources.
Intestate succession statutes favor
spouses and blood relatives
Which of the following statements regarding the generation-skipping transfer tax is CORRECT?
the tax is imposed when property is transferred to a skip person.
characteristic of the probate process?
time consuming
buy-sell agreement is used to
transfer a business interest at the death of an owner.
