QUESTION: 29

Which of the following statements concerning marital transfers to a non-U.S. citizen spouse is (are) correct?

1. A marital deduction is automatically available as long as property is transferred outright to the non-citizen spouse.
2. A marital deduction is automatically available if the transferor-decedent spouse is a U. S. citizen.

2 only
Both 1 and 2
Neither 1 nor2
1 only

Answer(s): C

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QUESTION: 30

Examples of terminable interests that are nondeductible for the federal estate tax marital deduction include which of the following?

1. A property interest that would pass to someone else if the surviving spouse remarries
2. A life estate in property that would pass to another person at the death of the surviving spouse

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

Answer(s): A

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QUESTION: 31

Which of the following statements concerning a power of appointment is (are) correct?

1. A power of appointment can be designed to restrict the donee's right to appoint the property in favor of a specific class of recipients.
2. A power of appointment can be designed to restrict the time period during which the donee may exercise the power.

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

Answer(s): C

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QUESTION: 32

In addition to substantial probate assets, a married man with two minor children has a $1,000,000 ordinary life insurance policy payable to his estate. He wants to make certain that if he predeceases his wife the death proceeds will be available to provide income for his wife during her lifetime and to provide for their two children after her death. He would like the policy and/or its death proceeds to be as free of federal gift and estate taxes as possible with respect to both him and his wife. Which of the following courses of action would best accomplish these objectives?

Designate his wife as beneficiary and she will establish a testamentary trust in her will to receive the proceeds at her subsequent death
Assign the policy to an irrevocable intervivos trust with five and five powers and designate the trustee to receive the death proceeds
Establish a revocable intervivos trust and designate the trustee to receive death proceeds
Assign the policy to his wife who will establish a revocable intervivos trust to receive the death proceeds

Answer(s): B

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QUESTION: 29

QUESTION: 30

QUESTION: 31

QUESTION: 32