To determine whether a taxable gift has been made, the IRS focuses on all the following factors EXCEPT:

AWas the transferred property real property or personal property?

BWas the value of the gift property in excess of the annual per-donee exclusion?

CDid the donor absolutely, irrevocably, and currently divest himself of dominion and control over the property?

DWas the property transferred for less than an adequate and full consideration in money or money's worth?

Answer : A

All the following statements concerning an estate for a term of years are correct EXCEPT:

AIt is an interest in property established for a specific duration.

BThe tenant has the right to possess the property during the term of his interest.

CThe tenant may transfer the property at the end of the term of his interest.

DAn interest may extend beyond the lifetime of the grantor.

Answer : C

All the following statements concerning a grantor-retained annuity trust (GRAT) or a grantorretained unitrust (GRUT) are correct EXCEPT:

AAfter the initial transfer to a GRAT, the grantor is prohibited from making additional contributions to the trust.

BFor gift tax purposes a grantor's retained interest in these trusts is valued at zero.

CPost-transfer appreciation of property transferred to these trusts is excluded from the grantor's gross estate.

DA grantor receives an annual payout from a GRUT that is based on the value that the trust grows or contracts to each year.

Answer : B

All the following statements concerning guardians for minors are correct EXCEPT:

AA guardian named in a deceased parents will is not necessarily binding on the court.

BA guardian has equitable title to the property he administers for the minor.

CA special guardian can be appointed by the court to protect a minor's rights in a legal proceeding.

DA guardian of the person of a minor may not necessarily be the guardian of the minor's property.

Answer : B

All the following statements concerning real properly ownership by married couples as joint tenants with right of survivorship are correct EXCEPT:

AThe deceased spouse's interest in the properly qualifies for the marital deduction since it passes outright to the surviving spouse.

BAll benefits of ownership remain available to the surviving spouse without interruption during the administration of the deceased spouse's estate.

CJointly held property between spouses does not pass through the probate estate of the first spouse to die.

DIn common-law states the total value of the properly receives a stepped-up tax basis in the estate of the first spouse to die.

Answer : D

Free Practice Questions for American College HS330 Exam