A. disposes of property owned at death regardless of when the propery was acquired
If a testator has another individual sign the testator's name to a will in the testator's presence and with his permission, one of the requirements for formal will signing has been met. T/F
True
In an estate proceeding, no bond will be required if the
D. all of the above
A disclaimer of property relates back to the date the will or trust was signed. T/F
False
If a decedent owned U.S. Govt Series EE bonds and the accumulated interest is to be reported during the estate administration, the interest from the bonds must be reported on the decedent's final Form 1040, Individual Income Tax Return. T/F
False
A demonstrative bequest is
B. paid from a specific source, and any deficiency is paid from the general estate.
A power of appointment
E. a and b
The first year of the estate fiduciary income tax return must end no later than December 31 T/F
False
Pretermitted heirs are persons who are specifically named by the testator in his will to be his beneficiaries. T/F
False
A skip person under generation-skipping transfer trust is a member of the generation "jumped over" in order to get to the next descending generation. T/F
False
Which of the following is the least accurate statement concerning a qualified terminable interest trust?
D. surviving spouse must meet specific criteria to qualify as a beneficiary.
and wife
et ux
beneficiary
cestui
man who executes a will
testator
transfer of property to a party, to be held for the benefit of another.
trust
Probate property
property owned soley by the deceased
Non-probate property
property owned by deceased where the disposition is made automatically or by operation of law at death.
Testamentary Trust
created by a will and is part of the will
Inter Vivos Trusts
Living trust
Credit Shelter Trust
aka: credit, family or residue trust. Nonmarital trust - assets having value equal to the federal estate tax exemption equivalent - tax exempt.
Marital & QTIP trusts
used to minimize the tax burden between the decedent's estate and the surviving spouse's estate. (Qualified terminable interest property)
Sprinkle Trust
discretionary trust. provides spendthrift protection, estate tax saving, income tax savings and funds are allocated according to need.
Spendthrift Trust
provision in a trust used to protect the assets from creditors.
Generation Skipping Transfer (GST) Trusts
A trust where the beneficiaries are not the next generation. The beneficiaries could be grand or great grandchildren.
Trusts for Disabled Children
used to provide funds for extraordinary benefits not provided by medicaid.
Standby Trusts
conduit trust. Upon grantor's death, the assets are distributed to another trust for distribution.
disposition of property in a will is devised T/F
True
disposition of personal property is a bequest T/F
True
Holographic Will
handwritten, signed and not notarized - valid in nearly half the states.
Noncupative Wills
oral will, made during the testator's last illness. Witnesses must be present and at least one must be willing to testify in court.
Self-Proving Clause
aan acknowledgment of the testator and affidavits of the witnesses, each made before a notary public.
Grounds for Invalidity
Incapacity
Fraud Execution/Inducement
Duress
Undue Influence
Pretermitted heirs
those born or acquired after the execution of the will
Per Stirpes
Estate divided into as many shares as there are (1) living children plus (2) deceased children leaving issue.
Per Capita
estate divided into as many shares as there are (1) surviving heirs in the nearest degree of kinship and (2) deceased heirs of the same class with suviving issue
Probate
liquidation and distribution process to convey legal title to the decedent's heirs or beneficiaries.
Primary Jurisdiction
domicile at time of death
Ancillary Jurisdiction
property owned in states other than where the domicile was established.
Estate Administration
1. Assemble and inventory estate
2. Pay claims, debts, and taxes
3. manage assets
4. account for and distribute assets
Informal Administration
used when there is no liklihood of disagreements or contests among the beneficiaries or heirs over the administration of the estate or distribution of assets.
Summary Administration
used when the value of the entire estate (less liens and encumbrances) does not exceed the allowances and exemptions.
Intestate Distributions
Once heirs are determined, the state's intestate succession statutes control distribution
Testate Distributions
Specific bequests and divises
Demonstrative bequests
General bequests
Residuary Dispostions
Ademption
Only in testate estates. When property bequeathed or devised no longer exists, the legatee gets nothing. (ademption by extinction)
Ademption by Satisfaction
When the testator distributes bequeathed property to the beneficiary prior to death.
Abatement
If, after pymt of claims and expenses, the remaining property is insufficient to satisfy all bequests and devises, a reduction of some or all the heir's shares must occur.
Elective Share
The Uniform Probate Code prohibits a spouse from being disenherited. The surviving spouse may accept the dispositive provisions of the will or take a statutory (elective) share.
Renunciation/Disclaimer
When a beneficiary does not wish to accept inherited property.
Final Distribution and Discharge
To close an estate, the representative files a verified statement that the assets were distributed and accounted for. The rep is discharged on yr from the date that stmt is filed.
Taxable Estate
Gross less allowable deductions: funeral and admin costs; claims; unpaid mtgs and debts; losses; charitable transfers; marital deduction.
Qualified Domestic Trust
requires that at least one trustee is a US citizen or domestic corporation. it permits no distributions unles the US Trustee has the authority to withhold estate taxes, meets tax regs for collection of estate tax, and allows the executor to elect the trust be treated as a QDT.