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Question #43 of 85   Question ID: 1251821 Four years ago, Evelyn created an irrevocable life insurance trust, transferred a life insurance policy that named her as the insured to the trust, and funded it with interest-bearing bonds. Income from trust assets is used to pay the premiums on the life insurance policy. The beneficiary of the trust is Evelyn's son, Bruce. The trustee is the trust department of a bank. What is one advantage of this trust arrangement for Evelyn?     A) She avoids having all income from the trust taxed to her during her lifetime.     B) She removed the proceeds of the insurance policy from her gross estate by transferring the policy to the trust.     C) She avoided all gift tax liability on the insurance policy by transferring it into the trust.     D) She will maintain control over the policy even though it is transferred to the trust.

Question 21 Which of the following is the best evidence of continuous ownership of property? a. Examination of canceled check in payment for the property. b. Examination of the deed. Oc. Examination of the title policy. Od. Examination of the client's property tax bills. 4

Question #2 of 85 If a transferor is concerned about shielding his assets from a creditor, which of the following transfer techniques should he utilize? He should create a testamentary bypass trust. He should transfer his assets to an UTMA for his minor child. He should transfer his assets to a Section 2503(c) minor's trust and name an independent trustee. He should execute a payable on death designation on his bank account.     A) II, III, and IV     B) II and III     C) I, III, and IV     D) II only

Problem 28-24 (c) (LO. 3) The trustee of the Geddings Trust has the discretion to distribute the income or corpus of the trust in any proportion between the two beneficiaries of the trust, Zoey and Milo. Under the trust instrument, Zoey must receive $5,000 and Milo must receive $10,000 from the trust every year. In the current year, the trust's accounting income is $15,000, and its DNI is $12,000. What amount income is recognized by the beneficiaries as the result of the distributions? Do not round immediate computations. Round your final answers to the nearest dollar. If an amount is zero, enter"0". a.  Zoey:   First-tier Distribution of $fill in the blank 1 and Second-tier Distribution of $fill in the blank 2.b.  Milo:     First-tier Distribution of $fill in the blank 3 and Second-tier Distribution of $fill in the blank 4.

Exercise 18-30 (Algorithmic) (LO. 9) With $6,790,000 Paul's will creates a trust with the following provisions: life estate to Jacob (Paul's son) and remainder to Anastasia (Paul's granddaughter and Jacob's daughter). Jacob dies when the value of the trust is $10,185,000. a. When does the generation-skipping transfer result? Upon Jacob's death b. What is the amount? Feedback Check My Work To prevent partial avoidance of Federal gift and estate taxes on large transfers, the tax law imposes an additional generation-skipping transfer tax (GSTT). The generation-skipping transfer tax (GSTT) is designed to preclude the avoidance of either the estate tax or the gift tax by making transfers that bypass the next lower generation.

Question Content AreaSimon sold investment property 2 years ago for $750. Simon's basis in the property was $200. Simon is receiving $150 per year from the buyer. Simon reports this income on the installment method. If Simon collects $150 in principal during the current year, how much gain should he report from the sale for the year? a.$0 b.$110 c.$75 d.$90 e.None of these choices are correct.

Question #23 of 85 Your client has taken the following actions: Established an inter vivos trust in which she reserved the power to revoke the trust if she is not satisfied with its operation Funded the trust with a diversified portfolio Named herself trustee and specified that, upon her death, her husband is to become the trustee Named herself and her husband as the income beneficiaries and her children as remainder beneficiaries after the surviving spouse's death Which one of the following is an income tax implication of this trust arrangement?     A) Your client, the grantor, must pay income tax on all income earned by the trust.     B) The trust must pay income tax on earned income that is not distributed.     C) The trust receives a deduction for the distributable net income paid to the lifetime income beneficiaries.     D) Income earned by the trust is taxed to the children as irrevocable remainder beneficiaries.

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QUESTION 27 Personal sources for funding your retirement could include all of the following, except: O A. Roth IRA B. TraditionalIRA O C. Pension D. Savings E. Stocks and Bonds

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a. What is the difference between distributing property per capita and per stirpes?     When would a per stirpes distribution be required? what are two ways in which the duties of an administrator differ from those of an executor? Must the grantor, trustee, and beneficiary of a trust all be different people? What formalities must be followed to create a testamentary trust?

Font L7 5 Ordinary income Long-term capital gains, allocable to corpus Legal and accounting fees, allocable to corpus b. What is the trust's DNI? LO.2, 3 The Allwardt Trust is a simple trust that correctly uses the calendar year for tax purposes. Its income beneficiaries (Lucy and Ethel) are entitled to the trust's annual accounting income in shares of one-half each. For the current tax year, Allwardt reports the following. $100,000 30,000 5,000 Use the format of Exhibit 28.5 to address the following items. a. How much income is each beneficiary entitled to receive? Paragraph c. What is the trust's taxable income? Accessibility: Investigate d. How much gross income is reported by each of the beneficiaries? 27 Styles

Module 5 - Practice QuestionMr. Jay Brown is 66 years of age and his 2020 income is made up of employmentincome of $75,800, contributed $6,500 to his RRSP. He also earned interestincome from Guaranteed Investment Certificate (GIC) of $3,700 during 2020 andreceived Old Age Security benefits of $7,400 (because of large business lossesduring the previous two years, no amount was withheld from the OAS payments).Mr. Brown and his family live in Toronto, Ontario. For 2020, Mr. Brown’semployer withheld maximum CPP ($2,898) and EI ($856) contributions. Otherinformation pertaining to 2020 is as follows:1. Mr. Brown’s spouse is 59 years old and qualifies for the disability tax credit.Her income for the year totaled $4,500.2. Mr. and Mrs. Brown have two daughters, Keith, aged 15 and Laura, aged17. Keith had income of $2,700 for the year while Laura had net income of$3,000. In September 2020, Laura began full time attendance at a Canadianuniversity. Mr. Brown paid her tuition fees of $6,000, of…

Question #82 of 85   Question ID: 1251900 All of the following statements regarding charitable remainder annuity trusts (CRATs) and charitable remainder unitrusts (CRUTs) are CORRECT except     A) the remainder beneficiary is a charity.     B) the annual payout to an income beneficiary may not exceed 50% of the value of the trust.     C) the remainder interest at inception must be greater than or equal to 10% of the original value of the property transferred to the trust.     D) they may be established as revocable trusts.