American College American College Certifications HS-330 Questions & Answers

• Question 281:

  All the following statements concerning guardians for minors are correct EXCEPT:

  A. A guardian has equitable title to the property he administers for the minor.

  B. A guardian of the person of a minor may not necessarily be the guardian of the minor's property.

  C. A guardian named in a deceased parent's will is not necessarily binding on the court.

  D. A special guardian can be appointed by the court to protect a minor's rights in a legal proceeding.

  Correct Answer: A

• Question 282:

  Among the assets in a decedent's gross estate is stock in a closely held corporation that was left to a nephew. The interest passing to the nephew is required to bear the burden of all estate taxes and expenses. The relevant facts concerning this estate are:

  -Adjusted gross estate $1,600,000

  -Fair market value of stock in

  -the closely held corporation 700,000

  -Funeral expenses 30,000

  -Executor's commission 50,000

  -

  Federal and state death tax 160,000

  A.

  $240,000

  B.

  $700,000

  C.

  $ 80,000

  D.

  0

  Correct Answer: A

• Question 283:

  Which of the following statements concerning the estate tax marital deduction is correct?

  A. The marital deduction available to a decedent in a community-property state is equal to the total amount of community property.

  B. The marital deduction available to a decedent in a common-law state is limited to a maximum of $1 million.

  C. The marital deduction available to a decedent in a common-law state is equal to one half the adjusted gross estate.

  D. The marital deduction available to a decedent in a common-law state is equal to the net amount of qualifying property passing to the surviving spouse.

  Correct Answer: D

• Question 284:

  All the following assets owned by a decedent pass by operation of law or by contract EXCEPT

  A. death benefits of a pension plan payable to a named beneficiary

  B. jointly owned real estate passing to the surviving joint tenant

  C. life insurance payable to a named beneficiary

  D. probate assets passing under the terms of a valid will

  Correct Answer: D

• Question 285:

  All the following statements concerning a federal estate tax deduction for a bequest or gift to a qualified charity are correct EXCEPT:

  A. The amount of a charitable deduction may not exceed 50 percent of a decedent's adjusted gross estate.

  B. An estate may deduct the value of the remainder interest in a charitable remainder trust.

  C. A life insurance policy that was assigned to a charity as a gift less than 3 years prior to the insured's death qualifies for a charitable deduction.

  D. The amount of a charitable deduction is reduced by any taxes and administrative expenses chargeable against the bequest.

  Correct Answer: A

• Question 286:

  Which of the following statements concerning the inclusion in a decedent-employee's gross estate of a lump-sum distribution from a qualified retirement plan to a beneficiary other than the employee's estate is (are) correct?

  1.

  Lump-sum distributions of payments attributable to the employer's contributions are excluded from the gross estate.

  2.

  Lump-sum distributions of payments attributable to the decedent-employee's contributions are excluded from the gross estate.

  A. 1 only

  B. Both 1 and 2

  C. Neither 1 nor 2

  D. 2 only

  Correct Answer: C

• Question 287:

  All the following statements concerning filing the federal estate tax return are correct EXCEPT:

  A. An automatic one-year extension for filing the estate tax return is granted when the decedent dies overseas.

  B. The estate tax return must be filed within 9 months of death unless an extension is granted by the IRS.

  C. An extension to file the estate tax return must be received and granted by the IRS before the time for filing the return expires.

  D. For persons dying this year, an estate tax return must be filed for gross estates plus adjusted taxable gifts that exceed $1.5 million.

  Correct Answer: A

• Question 288:

  Which of the following statements concerning the taxation of estates and trusts is correct?

  A. They are taxed on distributable net income that is retained.

  B. They are taxed as if they were partnerships.

  C. They are entitled to the standard deduction in determining tax.

  D. They are taxed as if they were corporations.

  Correct Answer: A

• Question 289:

  All the following are steps in calculating a decedent's maximum estate tax marital deduction EXCEPT:

  A. Subtract the allowable expenses and debts to determine the adjusted gross estate.

  B. Subtract the applicable exclusion amount available in the year of the decedent's death.

  C. Compute the decedent's gross estate.

  D. Determine the net amount of property in the gross estate that passes to the surviving spouse in a manner qualifying for the marital deduction.

  Correct Answer: B

• Question 290:

  A father bought stock for $100,000 and gave it to his son when it was worth $300,000. The father paid no gift tax on the transfer. When the son sold the property 2 years after the gift, his income tax basis was

  A. $300,000

  B. $200,000

  C. $100,000

  D. 0

  Correct Answer: C