Which of the following transactions is a taxable gift for federal gift tax purposes?
A. A grandmother purchased a U.S. savings bond that is registered as payable to her and her two grandchildren and the bond has not yet been surrendered for cash.
B. A father made a deposit of $100,000 into a bank account titled jointly with his son, and the son has not yet made any withdrawals.
C. A mother purchased listed common stocks titling them in joint names with her daughter and the stocks have not yet been sold.
D. A man deeded real estate to his sister but did not record the deed nor did he deliver the deed to his sister.
A wife makes outright gifts of $40,000 to her son this year, and her husband agrees to split the gifts with her. Which of the following correctly states the amount of the taxable gifts?
A. Wife $9,000, husband $9,000
B. Wife 0, husband $18,000
C. Wife $18,000, husband 0
D. Wife $19,000, husband $19,000
All the following statements concerning real property ownership by married couples as joint tenants with right of survivorship are correct EXCEPT:
A. Jointly held property between spouses does not pass through the probate estate of the first spouse to die.
B. In common-law states the total value of the property receives a stepped-up tax basis in the estate of the first spouse to die.
C. All benefits of ownership remain available to the surviving spouse without interruption during the administration of the deceased spouse's estate.
D. The deceased spouse's interest in the property qualifies for the marital deduction since it passes outright to the surviving spouse.
Which of the following statements concerning the estate tax marital deduction is correct?
A. The marital deduction available to a decedent in a common-law state is limited to a maximum of $1 million.
B. 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.
C. The marital deduction available to a decedent in a community-property state is equal to the total amount of community property.
D. The marital deduction available to a decedent in a common-law state is equal to one half the adjusted gross estate.
A father wants to accumulate funds for his 12-year-old son's college education. On the advice of his attorney, the father establishes an IRC Section 2503(c) trust and funds it with annual gifts. All the following statements concerning this arrangement are correct EXCEPT:
A. In the event of the son's death prior to age 21, trust assets must either be payable to the son's estate or be subject to a general power of appointment held by the son.
B. The father's annual gift tax exclusion must be reduced by any amount used to pay college tuition costs.
C. The trust must be irrevocable.
D. Any accumulated income and all trust principal must be available for distribution to the son when he attains age 21.
A father deeded a house as a gift to his daughter in 1990 but retained the right to live in it until his death. He died this year while still living in the house. The following are relevant facts: The father bought the property in 1980 for $130,000. The fair market value of the property when the gift was made in 1990 was $150,000. The father filed a timely gift tax return but paid no gift tax because of the applicable credit amount. The fair market value of the property at the father's death was $220,000. The daughter sold the property 3 months after her father's death for $220,000. She had a gain of
A. $120,000
B. 0
C. $140,000
D. $220,000
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. $100,000
B. 0
C. $300,000
D. $200,000
Many trust instruments provide for the removal of the original trustee. All the following are valid reasons for removal of a trustee EXCEPT:
A. A shift in trust situs is desirable because of changes in law.
B. The beneficiary is not able to get along with the present corporate trustee.
C. The beneficiary has moved his or her residence to a distant state.
D. The beneficiary has been successful with investments and wants to manage the trust assets.
All the following statements concerning real property ownership by married couples as joint tenants with right of survivorship are correct EXCEPT:
A. All benefits of ownership remain available to the surviving spouse without interruption during the administration of the deceased spouse's estate.
B. In common-law states the total value of the property receives a stepped-up tax basis in the estate of the first spouse to die.
C. Jointly held property between spouses does not pass through the probate estate of the first spouse to die.
D. The deceased spouse's interest in the property qualifies for the marital deduction since it passes outright to the surviving spouse.
Which of the following statements concerning the generation-skipping transfer tax (GSTT) is (are) correct?
-An annual exclusion against GSTT will shelter gifts by a grandparent to a trust benefitting multiple grandchildren.
-
Tuition payments made directly by a grandparent to a university for a grandchild's education are exempt from GSTT.
A.
Neither 1 nor 2
B.
1 only
C.
Both 1 and 2
D.
2 only
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