(TCO 9) Arnold and Irma are married and live in Maine. In 1990, they
purchase realty for $100,000 (Irma provides $80,000 and Arnold $20,000) and
list ownership as joint tenants with right of survivorship. In the current year,
Arnold dies first when the realty is worth $500,000. One result of these events
Arnold’s gross estate includes $250,000.
Arnold’s gross estate includes $100,000.
Arnold’s gross estate includes $400,000.
In 1990, Irma made a gift to Arnold of $60,000.
None of the above.
As to spouses, it does not matter what the original contribution was.
Automatically, 50% is included in the gross estate (choice a.). When the
property was purchased in 1990, Irma made a gift to Arnold of $30,000
(choice d.), although its effect would be neutralized by the marital deduction.
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(TCO 9) 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 the current
year, 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,
$300,000 is included in Mercedes’s gross estate,
and Willie makes a gift of $300,000.
$600,000 is included in Mercedes’s gross estate.
Willie makes a gift of $600,000.
$50,000 is included in Mercedes’s gross estate.
None of the above
Since the policy is jointly owned, only one-half of the proceeds is included in
Mercedes’s estate. Willie is treated as making a gift of the remaining half of
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