American College HS-330 Online Practice Questions and Exam Preparation

American College HS-330 Online Questions & Answers

• Question 201:

  Which of the following are ways of passing property from a deceased spouse to a surviving spouse so that the property will qualify for the federal estate tax marital deduction?

  1.

  When the surviving spouse receives the property by electing to take against the deceased spouse's will

  2.

  When the surviving spouse receives the property as a consequence of the qualified disclaimer of another beneficiary

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

• Question 202:

  A wife owns a $100,000 life insurance policy on her husband's life. She has named her son the revocable beneficiary. Which of the following statements concerning the life insurance is (are) correct?

  1.

  At the husband's death, the interpolated terminal reserve of the policy is a gift to the son.

  2.

  The annual increase in the cash value is a gift to the son.

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

• Question 203:

  Which of the following statements concerning a power of appointment is (are) correct?

  -

  A power of appointment can be designed to restrict the donee's right to appoint the property in favor of a specific class of recipients.

  -

  A power of appointment can be designed to restrict the time period during which the donee may exercise the power.

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

• Question 204:

  A single man with substantial assets and income is supporting his 80-year-old partially senile mother with monthly cash gifts. He is trying to find a practical way to support his mother while at the same time saving federal gift and income taxes without giving up ultimate control of any assets. Which of the following courses of action will best accomplish these objectives?

  A. Make her an interest free loan with a principal amount large enough to produce sufficient income for her support when invested in corporate bonds
  B. Purchase corporate bonds that pay interest in an amount sufficient for her to support herself and assign the interest payments to her
  C. Make her annual gifts of enough interest income from the tax free municipal bonds in his portfolio so that she will be able to support herself
  D. Make her a gift of enough corporate bonds from his portfolio so that she will be able to support herself from the interest payments
  C. Make her annual gifts of enough interest income from the tax free municipal bonds in his portfolio so that she will be able to support herself

• Question 205:

  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 trust must be irrevocable.
  C. Any accumulated income and all trust principal must be available for distribution to the son when he attains age 21.
  D. The father's annual gift tax exclusion must be reduced by any amount used to pay college tuition costs.
  D. The father's annual gift tax exclusion must be reduced by any amount used to pay college tuition costs.

• Question 206:

  All the following statements concerning property ownership by a married couple residing in a community-property state are correct EXCEPT:

  A. Property inherited during the marriage is the separate property of the spouse who inherited it.
  B. Income earned by one spouse becomes community property.
  C. Community property loses its identity when a community-property couple moves to a common- law state.
  D. All property that is not separate property is community property.
  C. Community property loses its identity when a community-property couple moves to a common- law state.

• Question 207:

  Which of the following areas of consideration present common ethical issues for the estate planner?

  A. Contractuality
  B. Conformity
  C. Conservancy
  D. Cooperation
  D. Cooperation

• Question 208:

  Which of the following statements concerning pooled-income funds is (are) correct?

  1.

  A pooled income fund is similar to a mutual fund maintained by a qualified charity.

  2.

  It is an irrevocable arrangement in which the remainder interest passes to charity.

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

• Question 209:

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

  A. 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.
  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. When a minority stockholder in a closely held corporation dies, his stock is valued on the basis of the "blockage" rule.
  D. Valuing closely held stock requires the consideration of several factors outlined by IRS rulings.
  D. Valuing closely held stock requires the consideration of several factors outlined by IRS rulings.

• Question 210:

  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.