CHAPTER27QUIZ - The Federal Gift and Estate Taxes 27-1...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
27-1 CHAPTER 27 THE FEDERAL GIFT AND ESTATE TAXES EXAMINATION QUESTIONS ____1. Under the Tax Relief Reconciliation Act of 2001, the exclusion amount for Federal estate and gift tax purposes is to remain at $1 million from 2002 onward. ____2. For Federal estate and gift tax purposes, the exemption equivalent is from the same as the exclusion amount. ____3. The use of the alternate valuation date (six months after the date of death) affects the income tax basis of property that an heir receives from an estate. ____4. The election of the alternate valuation date must decrease both the value of the gross estate or the estate tax liability. ____5. Bennett pays the surgeon and the hospital for his aunt’s gall bladder operation. Even if the aunt does not qualify as Bennett’s dependent, the transfer is not subject to the gift tax. 6. Gordan and Cristy are husband and wife and live in Arizona. In 1987, they purchased a commercial annuity for $300,000 using community funds. Under the terms of the contract, $2,250 a month is payable to them for Gordan's life. If Gordan predeceases Cristy, $1,900 a month is payable to Cristy. Gordan dies in 2006 when the replacement value of Cristy's annuity is $150,000. As to the annuity, Gordan's estate includes: a. $0. b. $75,000. c. $150,000. d. $300,000. e. None of the above. 7. Willie and Mercedes are husband and wife and have always lived in Pennsylvania, not a community property state. In 1980, using joint funds, they purchased an insurance policy (maturity value of $600,000) on Mercedes’s life. Their son, George, was designated as the beneficiary. In 2006, and at a time when the policy has a replacement cost of $50,000, Mercedes dies. As to the $600,000 insurance proceeds paid to George, a. $300,000 is included in Mercedes’s gross estate, and Willie makes a gift of $300,000. b. $600,000 is included in Mercedes’s gross estate. c. Willie makes a gift of $600,000. d. $50,000 is included in Mercedes’s gross estate. e.
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 06/11/2008 for the course ACCT 4153 taught by Professor Campbell during the Spring '08 term at The University of Texas at San Antonio- San Antonio.

Page1 / 5

CHAPTER27QUIZ - The Federal Gift and Estate Taxes 27-1...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online