QUESTION: 205

Nontax benefits of lifetime gifts include all the following EXCEPT to

reduce probate and administrative costs
avoid claims of creditors evidenced by liens
provide for the education of thedonee
obtain privacy that is not possible to obtain through testamentary transfers

Answer(s): B

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QUESTION: 206

All the following statements concerning a grantor-retained unitrust (GRUT) are correct EXCEPT:

When the grantor dies during the retained interest term, the estate tax benefits are increased.
When the trust is created, the grantor makes an irrevocable transfer to remainder person(s).
The transfer of the remainder interest in the trust is a current gift for gift tax purposes.
The grantor's applicable credit amount may be applied to the gifted remainder interest in the trust.

Answer(s): A

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QUESTION: 207

A wife makes outright gifts of $66,000 this year to her son, and her husband agrees to split the gifts with her. Which of the following correctly states the amount of the taxable gifts?

Wife $12,000, husband $32,000
Wife $32,000, husband $32,000
Wife $22,000, husband $22,000
Wife $44,000, husband 0

Answer(s): C

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QUESTION: 208

If a grantor establishes an irrevocable trust, the income of the trust will be taxed to the grantor if it is used to pay premiums for life insurance on the life of

the spouse of the grantor
the father of the grantor
a child of the grantor
a grandchild of the grantor

Answer(s): A

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QUESTION: 205

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QUESTION: 208

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