American College HS-330 Online Practice Questions and Exam Preparation

American College HS-330 Online Questions & Answers

• Question 11:

  A man died in February of this year. Last year, when he learned that he has a terminal illness, he immediately made the following gifts and filed the required gift tax return: Fair Market Value

  -Gift of listed stock to a

  -qualified charity $150,000

  -

  Gift of listed bonds to his wife 200,000

  -

  Gift of a boat to his son 5,000

  -

  Gift of a sports car to his daughter 5,000

  A. $190,000
  B. $360,000
  C. $150,000
  D

• Question 12:

  Mr. Conrad died early this year. Under the terms of his will, he left all his real estate and tangible personal property to his son. All the remainder of his probate estate was left to his wife, Mrs. Conrad. The following is a list of Mr. Conrad's probate assets and their fair market values at the time of his death:

  -Commercial real estate $150,000

  -Furniture and fixtures 50,000

  -Listed common stock 100,000

  -

  Other securities 200,000

  A. $800,000
  B. $600,000
  C. $300,000
  D. $400,000
  B. $600,000

• Question 13:

  Which of the following actions on the part of a trustee is (are) a breach of his duties?

  1.

  Placing substantial amounts of cash from the sale of securities in a noninterest bearing checking account for a period of years

  2.

  Investing all trust assets in securities that favor income beneficiaries to the detriment of remainderpersons

  A. 1 only
  B. Neither 1 nor 2
  C. Both 1 and 2
  D. 2 only
  C. Both 1 and 2

• Question 14:

  All the following are grounds for contesting a will EXCEPT:

  A. The widow was bequeathed less than her intestate share.
  B. The instrument is a forgery.
  C. The testator did not have testamentary capacity.
  D. The testator executed a later valid will.
  A. The widow was bequeathed less than her intestate share.

• Question 15:

  All the following statements concerning a power of appointment are correct EXCEPT:

  A. The appointee of a power of appointment is the party who exercises the power.
  B. The possible recipients of property after the exercise of a power of appointment depend on the terms of the power.
  C. Failure to exercise a power of appointment is known as a lapse of the power.
  D. The donee of a power of appointment might be restricted with respect to the time the power can be exercised.
  A. The appointee of a power of appointment is the party who exercises the power.

• Question 16:

  A person dying without a will loses all the following rights EXCEPT the right to

  A. give property to a charity
  B. take maximum advantage of the marital deduction
  C. name the person to settle the estate
  D. have assets pass to heirs
  D. have assets pass to heirs

• Question 17:

  Which of the following statements concerning the valuation of intangible personal property in the gross estate of a decedent is correct?

  A. When a minority stockholder in a closely held corporation dies, his stock is valued on the basis of the "blockage" rule.
  B. Certain U.S. Treasury bonds that are used to pay federal estate taxes at par are valued at their market price on the date of death of the owner.
  C. Valuing closely held stock requires the consideration of several factors outlined by IRS rulings.
  D. If there were no trades of a listed common stock on the date of the stockholder's death, the stock's value is based on its average daily price for the previous month prior to the shareholder's death.
  C. Valuing closely held stock requires the consideration of several factors outlined by IRS rulings.

• Question 18:

  All the following statements concerning the generation-skipping transfer tax (GSTT) are correct EXCEPT:

  A. The tax is imposed according to a graduated rate schedule similar to the federal estate and gift tax rates.
  B. The tax may be imposed on gifts in trust to grandchildren.
  C. The tax may be imposed on direct gifts to grandchildren.
  D. All donors have a cumulative $1.5 million exemption against generation-skipping transfers.
  A. The tax is imposed according to a graduated rate schedule similar to the federal estate and gift tax rates.

• Question 19:

  The personal representative of a decedent has the duty to file which of the following income tax returns?

  1.

  The decedent's final income tax return

  2.

  The estate's income tax return

  A. 2 only
  B. 1 only
  C. Both 1 and 2
  D. Neither 1 nor 2
  C. Both 1 and 2

• Question 20:

  Mr. Barlow died early this year. Under the terms of his will he left all his real estate and tangible personal property to his son. All the remainder of his probate estate was left to his wife, Mrs. Barlow. The following is a list of Mr. Barlow's probate assets and their fair market values at the time of his death:

  -Commercial real estate $150,000

  -Furniture and fixtures 75,000

  -Listed common stock 300,000

  -

  Other securities 200,000

  A. $400,000
  B. $825,000
  C. $600,000
  D. $500,000
  C. $600,000