All the following statements concerning an entity-purchase buy-sell agreement for a partnership are correct EXCEPT:
A. Both the partners and the partnership are parties to the agreement that provides for business continuation.
B. The partnership makes payments to the decedent-partner's estate to liquidate the partnership interest held by the estate.
C. The partnership, in effect, liquidates the interest held by the decedent-partner's estate.
D. It is the surviving partners who purchase the decedent's business interest so that the partnership can afford to pay the decedent's estate.
Which of the following statements concerning filing the federal estate tax return is correct?
A. A one-year extension for filing the estate tax return is granted when the estate contains a closely held business interest.
B. An automatic two-year extension for filing the estate tax return is granted when the decedent dies overseas.
C. The estate tax return must be filed within 9 months of death unless an extension is granted by the IRS.
D. For persons dying under current law, an estate tax return must be filed for all U.S. citizen decedents.
All the following statements concerning the ownership of real property as joint tenants with right of survivorship are correct EXCEPT:
A. If the joint tenants are two brothers and each contributed one half the property's purchase price, only one half the property's value will be in the estate of the first brother to die if his executor proves that the other brother contributed half of the purchase price.
B. If the joint tenants are husband and wife, because this is a qualified joint interest, one half the value of the property will be in the estate of the first spouse to die regardless of which spouse contributed to the purchase price.
C. If the joint tenants are brother and sister, no portion of the value of the property will be in the sister's estate if she dies first provided her executor proves that the brother contributed all the funds.
D. If three sisters inherited property as joint tenants with right of survivorship, the entire value of the property will be in the estate of the first sister to die.
All the following will be brought back into the donor's gross estate for federal estate tax purposes EXCEPT
A. the gift taxes paid last year on a gratuitous transfer of real property
B. a gratuitous transfer of real property with a reserved right to use and enjoy it for life
C. an outright, gratuitous transfer of real property in contemplation of death
D. a gratuitous transfer of real property to a revocable inter vivos trust
Which of the following statements concerning the ownership of real property as joint tenants with right of survivorship is correct?
A. If the joint tenants are husband and wife, because this is a qualified joint interest, the entire value of the property will be in the estate of the husband regardless of which spouse dies first.
B. If the joint tenants are brother and sister and the brother contributed all the funds to purchase the property, one-half of the value of the property will be excluded from the sister's estate if she dies first.
C. If three sisters inherited property as joint tenants with right of survivorship, the entire value of the property will be in the estate of the first to die.
D. If the joint tenants are two brothers and each contributed one half the property's purchase price, only one half the property's value will be in the estate of the first brother to die if his executor proves that the other brother contributed half of the purchase price.
Mr. Allen died early this year survived by his spouse Mrs. Allen. Among the items of family property are: 1.A $200,000 life insurance policy on Mr. Allen's life with Mrs. Allen designated as beneficiary. Mrs. Allen has been the owner of the policy ever since it was issued 4 years ago.
2.The family residence with a fair market value of $300,000. Mr. and Mrs. Allen own the residence jointly with the right of survivorship even though Mr. Allen purchased it with his separate funds. 3.A $20,000 bank account. Mr. and Mrs. Allen own the account jointly with the right of survivorship even though Mrs. Allen made all the deposits.
What amount of the family property will be included in Mr. Allen's gross estate for federal estate tax purposes?
A. $360,000
B. $300,000
C. $160,000
D. $350,000
Which of the following statements concerning a testamentary trust is correct?
A. It saves federal and state death taxes at the death of the grantor.
B. The assets in the trust are free of probate costs.
C. It becomes effective only at the death of the grantor.
D. The trust terms must be included in the will.
Mr. Allen died early this year survived by his spouse Mrs. Allen. Among the items of family property are:
1.A $200,000 life insurance policy on Mr. Allen's life with Mrs. Allen designated as beneficiary. Mrs. Allen has been the owner of the policy ever since it was issued 4 years ago.
2.The family residence with a fair market value of $300,000. Mr. and Mrs. Allen own the residence jointly with the right of survivorship even though Mr. Allen purchased it with his separate funds.
3.A $20,000 bank account. Mr. and Mrs. Allen own the account jointly with the right of survivorship even though Mrs. Allen made all the deposits.
What amount of the family property will be included in Mr. Allen's gross estate for federal estate tax purposes?
A. $350,000
B. $360,000
C. $300,000
D. $160,000
Having a will enables an individual to do which of the following?
1.
Make testamentary bequests to selected charitable organizations
2.
Make specific bequests to selected friends
A. 1 only
B. Neither 1 nor 2
C. 2 only
D. Both 1 and 2
A married man died intestate. In addition to his wife, he was survived by two minor children and both his parents. Which of the following statements describes the typical intestate distribution in this situation?
A. The widow receives at least one-third of the estate and the children divide the remainder of the estate equally.
B. The widow receives one-third of the estate and the remainder is divided equally among the two children and the parents of the decedent.
C. The widow receives half the estate and the remaining half is divided equally between the decedent's parents.
D. The widow receives the entire probate estate as trustee for the benefit of the two minor children.
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