Administration Of Wills/Trusts/ And Estates
5th Edition
ISBN: 9781285281308
Author: Brown
Publisher: Cengage
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The terms of a will currently undergoing probate are: “A gift to my brother Chris of $40,000 cash; to my son Eric, $75,000 from my Redstone Savings Bank account; and to my daughter Lauryn, all of my remaining property.” At the time of death, the balance in the savings account was $60,000, and there was additional cash (after payment of funeral expenses and all claims against the estate) of $95,000.
The gift to Chris is a
Ramon made the following transactions within three years of his death:
He gave a long-term certificate of deposit, which he had owned for 10 years, to his sister
He released his retained power to amend a trust that he had created to benefit his children
He bought a new car and gave it to his brother for his birthday
He established an irrevocable living trust to provide for his children's education with his brother as the trustee, and funded the trust with $100,000
Which of these transactions will be included in Ramon's gross estate?
A)
The new car
B)
The release of his retained power to amend the trust
C)
The irrevocable living trust
D)
The long-term certificate of deposit
A will has the following statement: “I leave $20,000 cash from my savings account in the Central Fidelity Bank to my sister, Angela.” This gift is an example of
A residual legacy.
A general legacy.
A demonstrative legacy.
A specific legacy.
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- Roger Kramer’s wife Sarah passed away five years ago, and she made Roger promise to continue to provide care for Sarah’s sister Margaret Smith and let her live in their residence for a period of time. Roger and Sarah had no children, and Margaret Smith was like a daughter to them. Roger passed away, and his will contained the following provisions:a. $200,000 of estate principal should be donated to the Sierra Club and the balance, less appropriate expenses, should be placed in theMargaret Smith trust.b. The Margaret Smith trust calls for 80% of periodic net income to be paid out to Margaret Smith with the balance to be considered trust corpus.c. The trust is to be terminated two years after Roger’s death at which time 60% of the corpus will be given to Margaret Smith and the balance to the Milwaukee Foundation to be placed in a fund to support environmental issues dealing with alternative energy sources.The following events occurred within one year of Roger’s death:1. In addition to…arrow_forwardWhile vacationing in Florida in November, Sally was seriously injured in an automobile accident (she died several days later). How are the following transactions handled for tax purposes?a. Bruce, Sally’s son and executor, incurred $6,200 in travel expenses in flying to Florida, retrieving the body, and returning it to Frankfort, Kentucky, for burial.b. Early in the year, Sally had pledged $50,000 to the building fund of her church. Bruce paid this pledge from the assets of the estate.c. Prior to her death, Sally had promised to give her nephew, Gary, $20,000 when he passed the bar exam. Gary passed the exam late in the year, and Bruce kept Sally’s promise by paying him $20,000 from estate assets.d. At the scene of the accident and before the ambulance arrived, someone took Sally’s jewelry (i.e., Rolex watch and wedding ring) and money. The property (valued at $33,000) was not insured and was never recovered.e. As a result of the accident, Sally’s auto was totally destroyed. The auto…arrow_forwardA will has the following statement: “I leave $20,000 cash from my savings account in the Central Fidelity Bank to my sister, Angela.” This gift is an example of: Choose the correct.a. A residual legacy.b. A general legacy.c. A demonstrative legacy.d. A specific legacy.arrow_forward
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