Chapter 2 - Gross Estate
Delivery and acceptance is an essential element of estate taxation.
False
Donation mortis causa are transfers intended to take effect at the time of the decedent's death. Hence, the property should be valued at the FMV of the property at the date of the actual transfer.
False
Regardless of situs, the tax code excludes "intangible" personal property of a non-resident alien decedent in determining his taxable estate.
False
Ron devised in his will real property to his brother Bert who is entrusted with the obligation to preserve and transmit the property to Jay, son of Bert, when Jay becomes of age. The transmission from Bert to his son Jay is subject to tax.
False
Section 85 of the Tax Code provides that the value of the gross estate of a nonresident alien should be determined by including the value at the time of his death, of all property, real or personal, tangible or intangible, wherever situated.
False
The donee-decedent of a special power of appointment only holds the property in trust, hence, the property shall form part of the donee-decedent's gross estate.
False
The payment of estate tax could only be extended up to the maximum of thirty (30) days from the date of filing.
False
There is reciprocity if the decedent at the time of his death was a resident citizen of a foreign country which at the time of his death did not impose an estate tax of any character in respect of tangible personal property of citizens of the Philippines not residing in that foreign country.
False
When an estate, under administration, has income-producing property, the annual income of the estate becomes part of the taxable gross estate.
False
Assume that the shares were traded in the stock exchange. However, the quoted price at the time of death was not determinable. Nonetheless, the highest and lowest quotations of the shares in the market were P140 and P80, respectively, what was the value included the decedent's gross estate? a.) P100,000 b.) P110,000 c.) P120,000 d.) P150,000
P110,000
A special power of appointment authorizes the donee of the power to appoint only from among a designated class or group of persons other than himself.
True
Donation to the national government is an exempt transaction but should still require inclusion of the property in the gross estate.
True
Estate tax is a tax imposed on the privilege that a person is given in the disposition of his property, either by will or by operations of law, to take effect upon death.
True
Estate tax is an ad-valorem tax.
True
For estate tax computation, real estate, in general, shall be valued at fair market value at the date of death of the decedent.
True
If zonal value of a real estate is available at date of death, and this is higher than the FMV per assessor's listings of values, then the amount to be reported in the gross estate is the zonal value.
True
Juan devised in his will a piece of land; naked title to Pedro and usufruct to Ana for as long as Ana lives, thereafter to Pedro. The transmission from Juan to Pedro and Ana is subject to estate tax but the merger of the usufruct and the naked title to Pedro upon the death of Ana is exempt.
True
The Tax Code as amended under RA10963 (TRAIN Law) provides that filing of estate tax return should be done within one (1) year from the decedent's death.
True
The accrual of the estate tax is distinct from the obligation to pay the same.
True
Under the "ability to pay theory", the imposition of estate tax is justifiable because it reduces the property received by the successor, thus, helping to promote equitable distribution of wealth in society.
True
When an estate, under administration, has income-producing property and its income during the year is distributed to the heirs, the income so distributed to the heirs as part of their gross income for the year.
True
Proceeds of life insurance to the extent of the amount receivable by the estate of the deceased, his executor or administrator under policies taken out by the decedent upon his own life shall be I. Part of the gross estate irrespective of whether or not the insured retained the power of revocation II. Not part of the gross estate if the beneficiary is irrevocable. III. Part of the gross income if the designation at the beneficiary is revocable IV. Not part of the gross income irrespective of whether or not the insured retained the power of revocation a.) I and II b.) I and III c.) I and IV d.) Only I
c.) I and IV
Use the following data for the next two (2) questions Following are properties in the gross estate with their FMV: *House and lot, family home in Quezon City - P1,500,000 *Bank deposit in the foreign branch of a domestic bank - P500,000 *Bank deposit in Makati branch of a foreign bank - P300,000 *Shares of stock issued by a domestic corporation (certificate kept in Canada) - P1,000,000 *Franchise exercised in Manila - P800,000 *Receivable, debtor from Mindanao - P200,000 If the decedent was non-resident alien and there is reciprocity, property excluded from gross estate is valued at: a.) P2,800,000 b.) P2,600,000 c.) P2,300,000 d.) P2,000,000
a.) P2,800,000
Assume that the shares were traded in the stock exchange. Assume further that the average value at the time of death was P100 per share. What was the value included the decedent's gross estate? a.) P100,00 b.) P110,000 c.) P120,000 d.) P150,000
b.) 110,000
If the decedent was non-resident alien and there is no reciprocity, the gross estate is valued at: a.) P4,300,000 b.) P3,800,000 c.) P3,500,000 d.) P3,200,000
b.) 3,800,000
An excise on transfers mortis causa a.) VAT b.) Estate tax c.) Income tax d.) Donor's tax
b.) Estate tax
Mr. Wais thought that due to old age, death may be imminent. Knowing that the value of estate tax is high, he disposed his properties to his rightful heirs prior to his death (transfer in contemplation of death). To prevent undue avoidance of tax, inter-vivos disposition in contemplation of death is subject to: a.) Donor's tax b.) Estate tax c.) Income tax d.) Excise tax
b.) Estate tax
Which of the following is NOT used when valuing gross estate? a.) FMV at the time of death; b.) FMV at the time the estate return is filed; c.) Zonal value when higher than the assessed value in case of real property; d.) Book value in case of shares not traded in the stock exchange.
b.) FMV at the time the estate return is filed
Decedent's interest I. Refers to the extent of equity or ownership participation of the decedent on any property physically existing and present in the gross estate, whether or not in his possession, control or dominion. II. Refers to the value of any interest, having value or capable of being valued or transferred, in property owned or possessed by the decedent at the time of his death. a.) I only b.) II only c.) Both I and II d.) Neither I nor II
b.) II only
Estate tax is a tax on the right of the deceased person to transmit his estate to his lawful heirs and beneficiaries. Hence, it is I. A tax on property. II. An excise tax. a.) I only b.) II only c.) Both I and II d.) Neither I nor II
b.) II only
Which of the following exempt transmissions will still require inclusion of the property in the gross estate? a.) Merger of the usufruct in the owner the naked title; b.) Legacy to a charitable institutions whose administrative expenses did not exceed 30% of the legacy; c.) Transfer from a first heir to a second heir designated by the decedent; d.) Death benefits under the GSIS and GSIS.
b.) Legacy to a charitable institutions whose administrative expenses did not exceed 30% of the legacy
Use the ff data for the next four (4) questions A decedent left 1,000 XYZ Corporation common shares. The shares were not traded in the stock exchange. The ff data were made available: *Capital stock, XYZ corporation - P10,000,000 *Retained earnings - 2,000,000 *Outstanding shares - 100,000 What was the value included the decedent's gross estate? a.) P100,000 b.) P120,000 c.) P150,000 d.) P0
b.) P120,000
Transfers in contemplation of death: Consideration received; FMV upon transfer; FMV upon death Land - P1,500,000; P1,500,000; P2,000,000 Shares of stock - 100,000; 50,000; 150,000 Vintage car - 50,000; 80,000; 100,000 Painting - 250,000; 400,000; 500,000 The correct gross estate should be a.) P120,000 b.) P300,000 c.) P300,000 d.)P350,000
b.) P300,000
Which is NOT a test of situs? a.) Residence of the debtor in case of accounts receivable. b.) Place of storage in case of certificates of stocks. c.) Location of depository bank in case of bank deposit. d.) Place of exercise in case of copyright.
b.) Place of storage in case of certificates of stocks.
Which of the ff. is NOT to be included in the gross estate of citizen decedent? a.) Dividend income declared, but not yet actually received at date of death b.) Share in partnership's profit earned immediately after date of death c.) Rent income accrued before death but collected after death d.) None of the above
b.) Share in partnership's profit earned immediately after date of death
The ff. are deemed transfers in contemplation of death, except a.) While still alive, the decedent donated property where the donation will take effect at the time of his death. b.) The decedent transferred a property in the regular course of the business operation. c.) The decedent donated a property with the condition that he/she will enjoy the fruits of such while he/she is still alive. d.) The decedent transferred a property to take effect after his/her death.
b.) The decedent transferred a property in the regular course of the business operation.
The personal property of a non-resident, not citizen of the Philippines, would NOT be included in the gross estate if; a.) The intangible personal property is in the Philippines b.) The intangible property is in the Philippines and the reciprocity clause of the estate tax law applies. c.) The tangible property is in the Philippines. d.) The personal property is shares of stocks of a domestic corporation 90% of whose business is in the Philippines.
b.) The intangible property is in the Philippines and the reciprocity clause of the estate tax law applies.
An agreement created by will or an agreement under which title to property is passed to another for conservation or investment with the income therefrom and ultimately the corpus to be distributed in accordance with the directives of the creator as expressed in the governing instrument a.) Estate b.) Trust c.) Fiduciary d.) Beneficiary
b.) Trust
One of the items in the gross estate of a decedent is a claim against an insolvent person amounting to P500,000. The insolvent debtor can still pay P100 000 out of the P500,000. How much will be included in and deducted from the gross estate? (Gross estate; Deduction) a.) 100,000; 100,000 b.) 500,000; 100,000 c.) 500,000; 400,000 d.) None; None
c.) 500,000; 400,000
A Filipino decedent residing in Hawaii during his lifetime, left the ff properties: *House & lot, USA - P10,000,000 *Mansion, PH - P50,000,000 *Cars, PH - P2,000,000 *Shares of stock, Singapore - P5,000,000 *A/R, USA - P3,000,000 The gross estate of the decedent is: a.) P70,000,000 b.) P67,000,000 c.) P65,000,000 d.) P62,000,000
c.) 65,000,000
Transfer in contemplation of death I. Refers to property formerly owned by the decedent but were no longer owned by him at the time of his death II. Contemplates a situation where the transferor during his lifetime, transfers property in contemplation of or intended to take effect in possession or enjoyment at or after his death. III. Includes situations where the transferor retains for life the possession or enjoyment, or the right to the income from the property, or the right to designate the person who shall possess or enjoy the property or the income therefrom. IV. At the time of the decedent's death, the decedent no longer owned the property, but such property forms part of his gross estate for estate tax purposes. a.) I and II only b.) I, II, and III only c.) All of the above d.) None of the above
c.) All of the above
Transfers in contemplation of death have the ff. in common: I. They are ostensible transfers, usually with the purpose to evade the estate tax. II. They are extension of interests. III. If the transfers are in fact for a bona fide consideration, then they will not form part of the gross estate. a.) I and II only b.) II and III only c.) All of the above d.) None of the above
c.) All of the above
Proceeds of Iife insurance includible in the taxable gross estate a.) Insurance proceeds from SSS or GSIS b.) Amount receivable by any beneficiary other than the estate, administrator or executor, irrevocably designated in the policy by the insured c.) Amount receivable by any beneficiary designated in the insurance policy d.) Proceeds of group insurance taken out by a company for its employees.
c.) Amount receivable by any beneficiary designated in the insurance policy
The ff statements pertain to rules on valuing the estate left by a decedent. Select the INCORRECT statement I. Values in the gross estate are based on values at the time of the decedent's death because it is at this time that the heir legally succeeds to the inheritance II. Receivable are appraised on the basis of the amount of the death principal and interests due and unpaid at the time of death. a.) I only b.) II only c.) Both I and II d.) Neither I nor II
c.) Both I and II
Which among the ff. is correct? I. There may be properties which at the time of the decedent's death are not in the estate because they were transferred by him during his lifetime. II. The gross estate, for purposes of the estate tax, may exceed the actual value of his assets at the time of his death as it includes the value of transfers of property by him during his lifetime that partake of the nature of testamentary dispositions. a.) I only b.) II only c.) Both I and II d.) Neither I nor II
c.) Both I and II
Which of the following is a transfer in contemplation of death? a.) Mhalapit Nth has been fighting for his life since he was diagnosed to have a terminal illness. Accepting his fate, he sought the assistance of Atty. Lho Yer, and made his will. b.) Mr. Matibay celebrated his 101st birthday. Feeling that death is not far, he transferred all his properties to Pedro and Juan. c.) Both a and b d.) Neither a nor b
c.) Both a and b
When the property is donated in contemplation of death, the basis of the tax shall be a.) FMV at the time of donation b.) FMV in the hands of the donor before the time of the donation c.) FMV at the time of death of the donor d.) Cost when the property was acquired
c.) FMV at the time of death of the donor
Which among the following statements is NOT correct? I. Estate taxation is governed by the statute in force at the time of death of the decedent. II. Estate tax accrues as of the death of the decedent. III. Succession takes place and the right of the State to tax the privilege to transmit the estate vests instantly upon death. a.) I only b.) II only c.) III only d.) None of the above
d. None of the above
The following are transactions exempt from transfer tax except: a.) Transmission from the first heir or donee in favor of another beneficiary in accordance with the desire of the predecessor. b.) Transmission or delivery of the inheritance or legacy by the fiduciary heir or legatee to the fideicommissary c.) The merger of usufruct in the owner of the naked title d.) All bequest, devices, legacies, or transfers to social welfare, cultural and charitable institutions
d.) All bequest, devices, legacies, or transfers to social welfare, cultural and charitable institutions
Which of the following item is considered situated outside the Philippines? a.) Franchise in the name of the decedent which is exercised in the Philippines b.) Share of stock holdings of decedent in a foreign corporation whose business is 90% done in the Philippines c.) Bond certificate issued by a domestic corporation owned by a non-resident decedent d.) Foreign currency deposited in bank outside the Philippines
d.) Foreign currency deposited in bank outside the Philippines
The power of appointment may be exercised by the donor-decedent through the following modes I. By will II. By deed to take effect in possession or enjoyment at or after his death. III. By deed under which he has retained for his life or any period not ascertainable without reference to his death or for any period which does not in fact end before his death. a.) I only b.) II only c.) I and II only d.) I, II, and III
d.) I, II, and III
One of the ff. is NOT an intangible personal property situated in the Philippines: I. Shares, obligations or bonds issued by any corporation or sociedad anonima organized and constituted in the Philippines in accordance with its laws. II. Shares, obligations or bonds issued by any foreign corporation where 85% of its business is located in the Philippines. III. Shares, obligations or bonds issued by a foreign corporation if such shares, obligation or bonds have acquired business in the Philippines. IV. Shares or rights in any partnership, business or industry established outside the Philippines. a.) I only b.) II only c.) III only d.) IV only
d.) IV only
As a rule, the basis of valuation of property in the gross estate is the FMV prevailing at the time of decedent's death. In the case of domestic shares of stock NOT traded thru the stock exchange, the FMV is a.) The value appearing in the schedule of fixed values from the assessor's office b.) Net realizable value c.) Acquisition cost d.) Issuer's book value
d.) Issuer's book value
Under which of the following situations an estate tax return is required to be tiled under the TRAIN Law? a.) Transfers which are subject to estate tax. b.) The estate consists of registered or registrable properties for which a clearance from the BIR Is required as a condition precedent for the transfer of ownership. c.) Both "a" and "b" d.) Neither "a nor "b"
d.) Neither "a nor "b"
Which of the following is a transfer under special power of appointment? I. Earl transfers his properly in trust for his son, Gabry and glen in trust for anybody whom Gabry may by will, appoint or designate. II. Mt Byahero frequently travels due to the nature of his profession. He thinks that he is not spared from meeting accidents considering the rampant occurrence of accidents these days. He decided to execute his Iast will and testament appointing his properties to his children. III. I. Georgia designated his special friend, E. Garcia as beneficiary of an Insurance which he took upon his own life. a.) I only b.) II only c.) All of the above d.) None of the above
d.) None of the above
Which of the following is not included in the gross estate? a.) Revocable transfer where the consideration is not sufficient b.) Revocable transfer where the power of revocation was not exercised c.) Proceeds of life insurance where the beneficiary designated is the estate and the designation is irrevocable d.) Proceeds of life insurance where the beneficiary designated is the mother and the designation is irrevocable
d.) Proceeds of life insurance where the beneficiary designated is the mother and the designation is irrevocable
Which of the following is subject to the rule of reciprocity? a.) Car in the Philippines owned by a non-resident alien decedent; b.) Investment in stock in a US Corporation owned by a non-resident alien decedent; c.) Investments in bonds in a US Corporation that has acquired business situs in the Philippines, and is owned by a resident alien; d.) Shares owned by a non-resident alien in a partnership established in the Philippines.
d.) Shares owned by a non-resident alien in a partnership established in the Philippines.
One of the following is NOT an intangible personal property situated in the Philippines: a.) Shares, obligations or bonds issued by any corporation or sociedad anonima organized or constituted in the Philippines in accordance with its law; b.) Shares, obligations or bonds issued by any foreign corporation 85% of the business of which located in the Philippines c.) Shares, obligations or bonds issued by any foreign corporation if such shares, obligations or bonds have acquired business situs in the Philippines; d.) Shares, obligations or bonds issued by a non-resident foreign corporation.
d.) Shares, obligations or bonds issued by a non-resident foreign corporation.
Statement 1: The Commissioner or any of the Revenue Officer authorized by him pursuant to the tax code shall have the authority to grant, in meritorious cases, a reasonable extension not exceeding thirty (30) days for filing the return. Statement 2: The application for the extension of time to file the estate tax return must be filed with the RDO where the estate is required to secure Its TIN and file tax return of the estate. a.) Statements 1 & 2 are false b.) Statement 1 is true but statement 2 is false c.) Statement 1 is false but statement 2 is true d.) Statements 1 and 2 are true
d.) Statements 1 and 2 are true
Which of the following statements is NOT true? a.) A general power of appointment authorizes the donee of the power to appoint any person to possess or enjoy the property. b.) A general power of appointment makes the donee of the power the owner of the property. c.) A power of appointment is not always general. d.) The appointed property passing under a general power of appointment is not inaudible in the gross estate of the donee-decedent.
d.) The appointed property passing under a general power of appointment is not inaudible in the gross estate of the donee-decedent.
Which of the following is NOT included in the gross estate? a.) Revocable transfer where the consideration is not sufficient b.) Revocable transfer where the power of revocation was not exercised c.) Transfer passing under general power of appointment d.) Transfer for sufficient consideration
d.) Transfer for sufficient consideration
Statement 1: The estate tax imposed under the Tax Code shall be paid by the executor or administrator before the delivery of the distributive share in the inheritance to any heir or beneficiary. Statement 2: The executor or administrator of an estate has the primary obligation to pay the estate tax but the heir or beneficiary has subsidiary liability for paying that portion of the estate corresponding to his distributive share in the value of the total net estate. a.) Statements 1 & 2 are false b.) Statement 1 is true but statement 2 is false c.) Statement 1 is false but statement 2 is true d.) Statements 1 and 2 are true
d.)Statements 1 and 2 are true
Decedent died in 2018 leaving a will which directed all real estate owned by him not to be disposed or sold for a period of 2 years after his death, and ordered that the property be given to Juan Dela Cruz after 2 years. In 2018, the estate left by the decedent had a FMV of P500,000. In 2020, the FMV of the said estate increased by P4,500,000 and the BIR Commissioner assessed thereon estate tax based on assessed value of P4,000,000 in 2018. What would be the correct amount of the gross estate? a.) P5,000,000 b.) P4,000,000 c.) P4,500,000 d.) P500,000
P500,000
Which of the following shall be considered personal property? I. Obligations and actions which have for their object movables or demandable sums. II. Shares of stock agricultural, commercial and industrial entities, although they may have real estate. a.) Both I and II b.) Neither I nor II c.) I only d.) II only
a.) Both I and II
An excise tax on transfers inter-vivos a.) Donor's tax b.) Estate tax c.) Income tax d.) VAT
a.) Donor's tax
Who shall file the estate tax return? a.) Executor, or administrator, or any of the legal heirs b.) Creditors of the decedent c.) Personal secretary of the decedent d.) Debtors of the decedent
a.) Executor, or administrator, or any of the legal heirs
Which of the following statements regarding transfer under general power of appointment and transfer under special power of appointment is correct? I. There are three persons involved under this rule; the transferor, the first transferee, and the second transferee. The first transferee is the decedent. II. If authority is granted by the transferor to the first transferee to determine the person, who, upon the latter's death, would next possess or enjoy the property transferred, his authority emanates from a general power of appointment. III. If the transferor himself had determined beforehand who upon the death of the first transferee, would next possess or enjoy the property, then the authority of the first transferee emanated from a special power of appointment. a.) I and II only b.) II and Ill only c.) All of the above d.) None of the above
a.) I and II only
The gross estate of a decedent shall be comprised of the following properties and interest therein at the time of his death, including revocable transfers and transfers for insufficient consideration, etc.: I. Residents and citizens: All properties, real or personal or intangible, wherever situated. II. Nonresident aliens: Only properties situated in the Philippines, that, with respect to intangible personal property, its inclusion in the gross estate is not subject to the rule of reciprocity a.) I only b.) II only c.) Both I and II d.) Neither I nor II
a.) I only
Which is correct? I. In a claim against insolvent person, the insolvency of the debtor must be proven and not merely alleged. II. It could be that the amount to be included as part of the gross estate in a claim against insolvent person is less than the full amount owed. a.) I only b.) II only c.) Both I and II d.) Neither I nor II
a.) I only
Which of the following is included In the income of the estate of a decedent? a.) Income received by the estate of a deceased person during the period of administration or settlement of the estate. b.) Excess of selling price over the appraised value placed upon the property at the time of death, where the property was sold after the settlement of the estate. c.) Appreciation in the value of properly passed to the executor or administrator upon death of decedent. d.) Delivery of property in kind to legatee or devisee.
a.) Income received by the estate of a deceased person during the period of administration or settlement of the estate.
Assume that the shares were classified as preference shares, what was the value included the decedent's gross estate? a.) P100,00 b.) P120,000 c.) P150,000 d.) P0
a.) P100,000
Pedro died on April 13, 2018, leaving the ff. properties: *Common stocks of Sunchamp Corporation (2,000 shares) - listed in the Philippine Stock Exchange (highest-P40; lowest-P39) *Common stocks of AgriNurture Corporation (1,500 shares) - not listed in the stock exchange. Cost - P50 per share; book value - P45 per share. *Preferred stocks of Greenergy Inc. (3,000 shares) - not listed in the stock exchange. Cost - P70 per share; Book value - P60 per share; Par value - P50 per share *Car (cost - P600,000; Book value - P350,000; Market value - P400,000) *Real properties (Zonal value - P120,000; Assessed value - P72,000) The gross estate of Pedro is -- a.) P817,500 b.) P816,500 c.) P824,000 d.) P846,500
a.) P817,500
In determining the net estate of a decedent, which of the following rules is NOT correct? a.) Real estate abroad is not included in the gross estate of a decedent who is a resident alien b.) Vanishing deduction must be subject to limitations c.) Shares of stocks being intangible property shall be included in the decedent's gross estate wherever situated. d.) Funeral expenses are deductible to the extent of 5% of the total gross estate but not exceeding P200,000
a.) Real estate abroad is not included in the gross estate of a decedent who is a resident alien
Which of the following is not true regarding a claim against insolvent persons? a.) The decedent's claim is deductible in full because the debtor's liabilities exceed his remaining assets. b.) The decedent's claim must be included in full in the gross estate. c.) The decedent's claim which cannot be collected is deductible according to the ratio of the debtor's assets to his liabilities. d.) Claim against insolvent person is a claim against person whose assets are not sufficient to pay his liabilities.
a.) The decedent's claim is deductible in full because the debtor's liabilities exceed his remaining assets.
Which of the following statements is correct? a.) The estate tax accrues as of the death of the decedent and the accrual of the tax is distinct from the obligation to pay the same. b.) Estate taxation is governed by the statute in force at the time the return is filed. c.) Both "a" and "b" d.) Neither "a" nor "b"
a.) The estate tax accrues as of the death of the decedent and the accrual of the tax is distinct from the obligation to pay the same.
Which of the following is NOT a characteristic of donation mortis causa? a.) The transfer to the donee is irrevocable while donor is alive. b.) There is no conveyance of title or ownership to the donee before death of the donor. c.) The transferor retains the full or naked ownership and control of the property while alive. d.) The transfer should be void if the donor should survive the donee.
a.) The transfer to the donee is irrevocable while donor is alive
Following are exclusion from gross estate, except: a.) Transfer in contemplation of death b.) Transfer as a result of which there is merger of usufruct in the owner of the naked title. c.) Amount received from SSS or GSIS d.) All of the above
a.) Transfer in contemplation of death
The rule of reciprocity applies to: I. Non-resident alien decedent II. Intangible personal property in the Philippines a.) Yes; Yes b.) No; No c.) Yes; No d.) No; Yes
a.) Yes; Yes
Which of the following rules on "situs" of property of a decedent correct? I. As a general rule, the situs real property is the place or country where it is situated. II. As a general rule, the situs of tangible personal property is the place or country where such is actually located at the time of the decedent's death III. The rule that situs of intangible personal property is the domicile or residence of the owner does not apply when the property has a situs elsewhere. IV. The test of situs of property of a non-resident alien decedent is not important at all because only the transmissions of property located in the Philippines are subject to estate tax. a.) I only b.) I and II only c.) I, II, and III only d.) I, II, III, and IV only
c.) I, II, and III only
Proceeds of life insurance where the beneficiary of the decedent is not his estate, executor or administrator is a.) Part of gross income if the beneficiary is revocable b.) Part of gross income regardless of whether the beneficiary is revocable or irrevocable c.) Not part of gross estate if the beneficiary is irrevocable d.) Part of gross estate regardless of whether the beneficiary is revocable or irrevocable
c.) Not part of gross estate if the beneficiary is irrevocable
A decedent left a piece of land. The ff data were available in connection with the property. *Assessed value, one (1) month before death - P2,500,000 *Zonal value, time of death - 2,000,000 *FMV at the time of filing estate tax return - 3,000,000 What would be the value of the piece of land in the gross estate? a.) P3,000,000 b.) P2,500,000 c.) P2,000,000 d.) Cannot be determined
c.) P2,000,000
Ms. Balo, spouse of the decedent who died in a bus accident (Harurot Transport), received P2,500,000 broken down as follows: *P900,000 - From Habambuhay Life Insurance Company. A life insurance taken out by the decedent designating his wife as revocable beneficiary. *P1,200,000 - From Walang Hangganan Life Insurance Company taken out by the decedent designating his wife as irrevocable beneficiary. *P400,000 - From Harurot Transport Company (owner of the bus involved in the accident) where settlement was made outside court proceedings. The gross estate of the decedent shall include a.) 900,000 b.) 1,200,000 c.) P2,100,000 d.) P2,500,000
c.) P2,100,000
A revocable transfer was made for a consideration of P100,000. Fair market values of the property at the time of transfers and at the time of death were P250,000 and P300,000, respectively. In the gross estate, the value of the property was a.) P100,000 b.) P250,000 c.) P200,000 d.) Exempt
c.) P200,000
If the decedent was a nonresident alien and assuming there is no reciprocity, how much is the gross estate? a.) P10,700,000 b.) P6,600,000 c.) P6,100,000 d.) P5,850,000
c.) P6,100,000
Use the ff data for the next two (2) questions The gross estate of a decedent included in the ff (Cost; Fair Value) *Land and building, PH - P1,600,000; P2,000,000 *House and lot, UK - 1,800,000; 1,500,000 *Personal properties, UK - 1,000,000; 600,000 *House and lot, PH - 4,000,000; 3,500,000 *Shares of stocks, UK corp. - 0; 200,000 *Shares of stocks, domestic corp. (certificate kept in UK) - 0; 250,000 *Shares of stocks, domestic corp. (certificate kept in PH) - 0; 100,000 *Franchise exercised in the PH- 0; 200,000 *Franchise exercised in UK - 0; 150,000 *Receivables, debtor is from UK - 0; 50,000 *Receivables, debtor is from PH - 0; 50,000 If the decedent was a nonresident alien and his country exempts a Filipino citizen from estate tax, how much of his assets would be subject to reciprocity? a.) P1,000,000 b.) P800,000 c.) P600,000 d.) P350,000
c.) P600,000
One of me following is included in the gross estate of a nonresident alien decedent: a.) Wholly uncollectible claims against a debtor who absconded, debtor resides outside the Philippines. b.) Partially collectible claims against an insolvent person who resides in Manila, the country of the nonresident alien decedent does not impose transfer taxes of any kind. c.) Proceeds of life Insurance of the decedent where the decedents estate was designated as irrevocable beneficiary, the policy was procured in Manila. d.) Personal property situated in the Philippines donated by the decedent before he died to a son on account of the son's marriage.
c.) Proceeds of life Insurance of the decedent where the decedents estate was designated as irrevocable beneficiary, the policy was procured in Manila.
Estate tax is imposed upon the: a.) Decedent b.) Property or rights transferred c.) Right to transfer property upon death d.) Privilege to receive inheritance
c.) Right to transfer property upon death
Which is wrong? a.) A power of appointment is the right to designate the person or persons who shall succeed to the property of a prior decedent. b.) A special power of appointment authorized the donor of the power to appoint only from among a designated class or group of persons including himself. c.) The done-decedent of a special power of appointment only holds the property in trust, hence, the property shall not form part of the done-decedent's gross estate. d.) None of the above
c.) The done-decedent of a special power of appointment only holds the property in trust, hence, the property shall not form part of the done-decedent's gross estate.
All of the following statements are true, except a.) In a revocable transfer, the decedent during his lifetime may revoke, after, amend, or terminate the terms of enjoyment or ownership of the property. b.) A revocable transfer is always includible in the gross estate of the decedent-transferor. c.) The power of Pre decedent-transferor to revoke terms may be exercised just once. d.) A revocable transfer shall be included in the gross estate of the decedent-transferor even though the power to revoke was not exercised.
c.) The power of Pre decedent-transferor to revoke terms may be exercised just once.
Which of the following transfer is NOT included in the gross estate? a.) Transfer with reservation of certain rights b.) Transfer for insufficient consideration c.) Transfer for an adequate full consideration in money or moneys worth d.) Transfer in contemplation of death
c.) Transfer for an adequate full consideration in money or moneys worth
When will the transfer through succession be effective? a.) Upon the signing of a written will b.) Upon payment of estate tax. c.) Upon death of the testator d.) Upon registration in the register of deeds.
c.) Upon death of the testator
