QUESTION: 229

All the following are proper actions on the part of a trustee EXCEPT

purchasing assets for personal use from the trust at their fair market value with the approval of all beneficiaries
investing trust assets in speculative securities in accordance with the provisions of the trust instrument
placing cash from the sale of securities in a non-interest bearing checking account for an extended period of time
purchasing securities in good faith from a third party just prior to a sharp decrease in their value

Answer(s): C

Which of the following statements concerning antenuptial an agreement is (are) correct?
1. They are frequently used prior to second marriages.
2. They can affect a surviving spouse's right to receive an intestate share of a deceased spouse's estate.

Neither 1 nor 2
2 only
1 only
Both 1 and 2

Answer(s): D

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QUESTION: 231

Requirements for property to qualify for the federal estate tax marital deduction include which of the following?
1. The property interest must be includible in the decedent's gross estate.
2. The property must pass in such manner that it will be includible in the surviving spouse's estate at death unless consumed or given away.

1 only
Both 1 and 2
Neither 1 nor 2
2 only

Answer(s): B

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QUESTION: 232

Among the assets in a decedent's gross estate is stock in a closely held corporation that was left to a nephew. The interest passing to the nephew is required to bear the burden of all estate taxes and expenses. The relevant facts about this estate are:
* Adjusted gross estate $1,200,000
* Fair market value of stock in the
* closely held corporation 500,000
* Administration and funeral expenses 25,000
* State inheritance taxes 40,000
* Federal estate taxes 160,000

What amount of closely held corporate stock may be redeemed under IRC Section 303 so that the redemption will be treated as a sale or exchange rather than a dividend distribution?

$225,000
$500,000
0
$ 65,000

Answer(s): A

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QUESTION: 229

QUESTION: 230

QUESTION: 231

QUESTION: 232