Estate Planning Chapter 15 Quiz

Beneficiary = Person entitled to receive benefits from a trust or will Executor = Person appointed to carry out the terms of a will Grantor = Individual who creates a trust Trustee = Person or institution that manages a trust

Revocable Trust = Can be altered or revoked by the grantor Irrevocable Trust = Cannot be easily altered once established Charitable Remainder Trust = Provides income to the donor and then donates remaining assets to charity Bypass Trust = Allows the surviving spouse to access assets while avoiding estate tax

Joint Tenancy with Right of Survivorship = Ownership where if one owner dies, the other inherits their share Tenancy in Common = Ownership where each party holds a distinct share that can be sold or passed on Tenancy by the Entirety = Joint ownership available only to married couples with rights of survivorship Separate Property = Property owned by one spouse that is not subject to division in divorce

<p>Durable Power of Attorney = Remains in effect even if the principal becomes incapacitated Medical Power of Attorney = Grants authority to make health care decisions on behalf of the principal Springing Power of Attorney = Takes effect only under specified conditions, such as incapacity Power of Attorney = General designation allowing someone to act on another's behalf</p> Signup and view all the answers

<p>Bequest = A gift made through a will Probate = The legal process of administering a deceased person's estate Letter of Instruction = A document that provides guidance for the executor about the deceased's wishes Intestate = Describes a person who dies without a will</p> Signup and view all the answers

<p>Executor = Administers the estate of a deceased person Trustee = Manages the assets held in a trust Guardian = Responsible for the care of a minor child Grantor = Creates a trust for asset management</p> Signup and view all the answers

<p>Irrevocable trust = Cannot be modified after creation Charitable remainder trust = Provides income to the grantor and donates the remainder to charity Living trust = Used during the grantor's lifetime to manage properties Testamentary trust = Created through a will and comes into effect after death</p> Signup and view all the answers

<p>Joint tenancy with right of survivorship = Ownership where the surviving owner inherits the deceased owner's share Tenancy in common = Ownership where each party can own a different percentage of the property Tenancy by the entirety = Ownership limited to married couples with right of survivorship Separate property = Property owned individually, not shared with a spouse</p> Signup and view all the answers

<p>Durable power of attorney = Remains effective even if the grantor becomes incapacitated Medical power of attorney = Authorizes someone to make health care decisions for another Springing power of attorney = Becomes effective only under specified conditions General power of attorney = Grants broad powers to act on behalf of the principal</p> Signup and view all the answers

<p>Will = Specifies the distribution of assets after death Letter of instruction = Provides guidance on personal wishes and funeral arrangements Bequest = A specific gift of property left in a will Probate = The legal process of settling an estate and distributing assets</p> Signup and view all the answers

<p>Executor = Administers the estate Trustee = Manages a trust Guardian = Cares for minor children Grantor = Creates the trust</p> Signup and view all the answers

<p>Irrevocable trust = Cannot be changed once established Revocable trust = Can be modified or revoked by the grantor Charitable lead trust = Provides payments to charity first Testamentary trust = Established through a will</p> Signup and view all the answers

<p>Joint tenancy with right of survivorship = Surviving owners automatically inherit the share Tenancy in common = Ownership shares can be unequal Tenancy by the entirety = Property owned jointly by married couples Separate property = Property owned individually, not shared</p> Signup and view all the answers

<p>Will = Distributes assets after death Durable power of attorney = Grants authority to manage affairs if incapacitated Letter of instruction = Provides guidance to the executor Medical power of attorney = Decides healthcare matters when unable to do so</p> Signup and view all the answers

<p>Bequest = Gift made through a will Probate = Legal process for validating a will Intestate = Dying without a will Step-up in basis = Adjusting property value at the time of inheritance</p> Signup and view all the answers