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Questions and Answers
Which of the following is NOT a tax characteristic of gifts made to a trust?
Which of the following is NOT a tax characteristic of gifts made to a trust?
- Gifts made to a trust are treated as gifts made to the trust beneficiaries (correct)
- The $16,000 annual exclusion from gift tax is available for gifts of present interests in property made to an unlimited number of U.S. citizen donees
- Gifts to U.S. citizen spouse: Unlimited marital deduction
- Annual exclusion for gifts to a non-citizen spouse: 2022: $164,000
Which of the following is TRUE regarding the situs of a trust?
Which of the following is TRUE regarding the situs of a trust?
- The situs of a trust is its legal home (correct)
- The situs of a trust cannot be changed
- The situs of a trust is determined by the location of the trustee
- The situs of a trust has no impact on tax liabilities
What are some reasons why trusts are useful and necessary?
What are some reasons why trusts are useful and necessary?
- To exercise control over assets
- To provide professional management and investment
- To protect assets from creditors
- All of the above (correct)
What are some advantages of living trusts?
What are some advantages of living trusts?
Which of the following is a disadvantage of using a Bypass Trust?
Which of the following is a disadvantage of using a Bypass Trust?
Which of the following is a potential issue when using a Disclaimer Trust?
Which of the following is a potential issue when using a Disclaimer Trust?
According to the text, how much can a married couple exclude from transfer taxes with proper planning?
According to the text, how much can a married couple exclude from transfer taxes with proper planning?
Which of the following is a potential advantage of using a Bypass Trust?
Which of the following is a potential advantage of using a Bypass Trust?
Which of the following is a requirement for a Generation-Skipping Trust to be exempt from the GST tax?
Which of the following is a requirement for a Generation-Skipping Trust to be exempt from the GST tax?
What is the purpose of an irrevocable life insurance trust (ILIT)?
What is the purpose of an irrevocable life insurance trust (ILIT)?
What is the Crummey power in relation to a trust?
What is the Crummey power in relation to a trust?
What is the suggested limit for the annual Crummey withdrawal power?
What is the suggested limit for the annual Crummey withdrawal power?
Which type of policy is designed to provide liquidity to pay estate taxes or other taxes and/or expenses at the second death?
Which type of policy is designed to provide liquidity to pay estate taxes or other taxes and/or expenses at the second death?
What is the maximum duration of the non-charitable interest in a Charitable Remainder Trust?
What is the maximum duration of the non-charitable interest in a Charitable Remainder Trust?
What is the minimum annual payout required for a Charitable Remainder Trust?
What is the minimum annual payout required for a Charitable Remainder Trust?
What is the purpose of drafting language in a trust that allows the trustee the discretion to make payments to the non-insured spouse during his or her lifetime?
What is the purpose of drafting language in a trust that allows the trustee the discretion to make payments to the non-insured spouse during his or her lifetime?
Which of the following is true about Charitable Remainder Trusts and S Corporation stock?
Which of the following is true about Charitable Remainder Trusts and S Corporation stock?
What determines the value of the donor's federal income tax deduction for gifts to a Charitable Remainder Trust?
What determines the value of the donor's federal income tax deduction for gifts to a Charitable Remainder Trust?
What is the gift tax consequence of transferring to a Charitable Remainder Trust?
What is the gift tax consequence of transferring to a Charitable Remainder Trust?
Which of the following is NOT a characteristic of a beneficiary in a trust?
Which of the following is NOT a characteristic of a beneficiary in a trust?
What is the distinction between 'income' and 'principal' in a trust?
What is the distinction between 'income' and 'principal' in a trust?
What is the difference between a simple trust and a complex trust?
What is the difference between a simple trust and a complex trust?
What is a grantor trust?
What is a grantor trust?
Which of the following is a requirement for a 'QTIP' trust?
Which of the following is a requirement for a 'QTIP' trust?
Which of the following is true about a 'QTIP' trust?
Which of the following is true about a 'QTIP' trust?
Which of the following is a requirement for a Marital Deduction Trust for a Non-Citizen Spouse (Qualified Domestic Trust – 'QDOT')?
Which of the following is a requirement for a Marital Deduction Trust for a Non-Citizen Spouse (Qualified Domestic Trust – 'QDOT')?
What happens if the parent is the transferor and custodian of a Uniform Gift to Minors Act or Uniform Transfer to Minors Act account, and dies while the account is still open?
What happens if the parent is the transferor and custodian of a Uniform Gift to Minors Act or Uniform Transfer to Minors Act account, and dies while the account is still open?
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