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Fideicommissary substitution is also known as direct substitution.
Fideicommissary substitution is also known as direct substitution.
False
For fideicommissary substitution to be valid, it must not go beyond two degrees from the heir originally substituted.
For fideicommissary substitution to be valid, it must not go beyond two degrees from the heir originally substituted.
False
The fiduciary or first heir in a fideicommissary substitution must outlive the second heir for the substitution to take effect.
The fiduciary or first heir in a fideicommissary substitution must outlive the second heir for the substitution to take effect.
False
The capital of the surviving spouse is considered part of their gross estate for tax purposes.
The capital of the surviving spouse is considered part of their gross estate for tax purposes.
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Usufruct refers to the exclusive property of the husband in a marriage.
Usufruct refers to the exclusive property of the husband in a marriage.
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Preferred shares are included in the calculation of estate tax exemptions.
Preferred shares are included in the calculation of estate tax exemptions.
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A power of appointment allows the decedent to designate who will possess or enjoy the property or its income after his death.
A power of appointment allows the decedent to designate who will possess or enjoy the property or its income after his death.
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A general power of appointment restricts the donee to appoint only among a restricted or designated class of persons.
A general power of appointment restricts the donee to appoint only among a restricted or designated class of persons.
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A limited power of appointment allows the donee to appoint among a restricted or designated class of persons.
A limited power of appointment allows the donee to appoint among a restricted or designated class of persons.
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A decedent can exercise a power of appointment through a deed executed during his lifetime.
A decedent can exercise a power of appointment through a deed executed during his lifetime.
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A power of appointment can never be exercised in favor of the donee's creditors.
A power of appointment can never be exercised in favor of the donee's creditors.
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A decedent retains the right to income from property under a deed executed after his death.
A decedent retains the right to income from property under a deed executed after his death.
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Life insurance proceeds left to an irrevocable beneficiary are subject to estate tax.
Life insurance proceeds left to an irrevocable beneficiary are subject to estate tax.
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Usufructuary rights are considered part of the decedent's estate for estate tax purposes.
Usufructuary rights are considered part of the decedent's estate for estate tax purposes.
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Transfer in contemplation of death refers to transfers made when the transferor is on the brink of death.
Transfer in contemplation of death refers to transfers made when the transferor is on the brink of death.
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Revocable transfer means the decedent has no power to alter or revoke the transfer during their lifetime.
Revocable transfer means the decedent has no power to alter or revoke the transfer during their lifetime.
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Property passing under a general power of appointment allows the decedent to designate who will inherit the property.
Property passing under a general power of appointment allows the decedent to designate who will inherit the property.
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Preferred shares held by the decedent are exempt from estate tax due to their unique nature.
Preferred shares held by the decedent are exempt from estate tax due to their unique nature.
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Study Notes
Fideicommissary Substitution
- Fideicommissary substitution is a type of indirect substitution where the fiduciary or first heir is entrusted with the obligation to preserve and transmit the whole or part of the inheritance to a second heir.
- For its validity and effectivity, such substitution does not go beyond one degree from the heir originally substituted.
- The fiduciary or first heir and the second heir must be living at the time of the testator's death.
Bequests, Devises, Legacies, and Transfers
- All bequests, devises, legacies, or transfers to social welfare, cultural, and charitable institutions are exempt, provided that not more than 30% of the net income is used for administration purposes.
- The net income of these institutions must not benefit any individual.
Capital of Surviving Spouse
- The capital of the surviving spouse is not deemed part of the gross estate.
- The capital of the surviving spouse refers to the separate property of the surviving spouse.
- The exclusive property of the husband is called capital, while the exclusive property of the wife is called paraphernal.
Power of Appointment
- A power of appointment can be a general or limited/special power.
- A general power of appointment authorizes the donee to appoint any person, including himself, his spouse, his estate, his executor, or administrator, and his creditor.
- A limited power of appointment allows the donee to appoint only among a restricted or designated class or persons other than himself.
Property and Interest
- The value of any interest in property owned or possessed by the decedent at the time of his death is included in the gross estate.
- Examples include dividends declared before death but received after death, partnership profits, usufructuary rights, etc.
- The value of property, right, or interest in the property transferred by the decedent during his lifetime, which is in the nature of testamentary disposition, is also included in the gross estate.
Transfer in Contemplation of Death
- A transfer in contemplation of death is a transfer impelled by the thought of death, regardless of whether the transferor was near the possibility of death or not.
- The motivating factor or controlling motive is the thought of death.
Revocable Transfer
- A revocable transfer is where the enjoyment of the property transferred may be altered, amended, revoked, or terminated by the decedent.
- The revocability is not affected by the failure of the decedent to exercise the power to revoke during his lifetime.
Property Passing Under General Power of Appointment
- A power of appointment is the right to designate the person or persons who will succeed to the property of the prior decedent.
- Property passing under a general power of appointment is included in the gross estate.
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Description
Learn about fideicommissary substitution, also known as indirect substitution, which involves entrusting the fiduciary or first heir with the obligation to preserve and transmit the inheritance to a second heir. This type of substitution is limited to one degree from the originally substituted heir.
