CANNON CTFA PREP QUESTIONS |
REVISION STUDY NOTES 2025\26 |
GUARANTEED ACCURATE
ANSWERS |LATEST VERSION
Jean and John Simmons are married and own their own home as tenants
by entirety. When John dies the home is valued at $350,000. How much
will be counted in his gross taxable estate?
A. None, as it passes directly to his spouse, Jean.
B. $175,000 - or one-half of the value
C. $225,000 - or the full amount minus the $125,000 one-time exclusion
for capital gains on a person residence.
D. $350,000 - the full amount is includable. - ACCURATE
ANSWERS✔✔ B. $175,000 - or one-half the value
Once a will is properly drafted it is valid:
A. in all states.
B. for the state for which it was prepared.
C. in all states for a period of 5 years.
D. for the state for which it was prepared for a period of 5 years. -
ACCURATE ANSWERS✔✔ B. for the state for which it was prepared.
,In managing personal trust assets, a trustee should seek which of the
following?
A. maximum income
B. preservation of capital
C. reasonable income and preservation of capital, including purchasing
power
D. maximum income and reasonable preservation of capital -
ACCURATE ANSWERS✔✔ C. reasonable income and preservation of
capital including purchasing power
A decedent's estate being settled by your bank contains an antique
automobile. One of the directors of your bank indicates that he would
like to buy it. You should do which of the following?
A. Sell it to him at a bargain price and befriend him.
B. Have a qualified appraisal done and offer it to him at that value.
C. Explain that he may not purchase the car from the estate.
D. Arrange for a public auction at which he may buy it if he is the
highest bidder. - ACCURATE ANSWERS✔✔ C. Explain that he may
not purchase the car from the estate.
EXAMLINKS
STUDY SMART,
,If you hold a rental property in an irrevocable trust, when is it all right to
rent to an employee of your trust department?
A. Never
B. When the employee pays fair rent.
C. When the employee has been with you at least 5 years and can be
trusted.
D. When the employee has no connection with the account or
beneficiaries. - ACCURATE ANSWERS✔✔ A. Never
Which of the following generally may NOT hold real property?
A. Revocable Living Trusts trusteed by a corporate fiduciary.
B. Uniform Gift to Minors Account
C. 2503(c) Minors Trust
D. Uniform Transfer to Minors Account - ACCURATE ANSWERS✔✔
B. Uniform Gifts to Minors Account
H's will provides that upon his death, $1 million will be held in a trust
for the benefit of his wife, W. This trust provides that W will receive all
of the trust income and will receive distributions of principal int he form
of an annuity for her lifetime. At W's death, the remaining trust assets
will be distributed to a designated charity. H's executor intends to make
EXAMLINKS
STUDY SMART,
, a "QTIP" election for this trust. Will the legacy to the trust, or any part
thereof, be deductible by H's estate, or if so, why?
A. Yes, the entire $1 million will qualify for the estate tax marital and
charitable deductions.
B. No, none of the $1 million will qualify for the estate tax marital and
charitable deductions.
C. Yes, the entire $1 million will qualify for the estate tax marital
deduction.
D. Yes, the value of W's income interest will qualify for the marital
deduction; the remainder will not qualify for any deduction. -
ACCURATE ANSWERS✔✔ C. Yes, the entire $1 million will qualify
for the estate tax marital deduction.
H makes a gift of property to a trust for the benefit of his children. If H
serves as a trustee, what limitations, if any, should be placed on his
distribution powers in order to avoid adverse gift and estate tax
consequences?
A. H's power to make distributions should be limited by ascertainable
standards such as health, support and education.
B. No limitations are required.
C. H should be prohibited from participating in making any
distributions.
EXAMLINKS
STUDY SMART,
REVISION STUDY NOTES 2025\26 |
GUARANTEED ACCURATE
ANSWERS |LATEST VERSION
Jean and John Simmons are married and own their own home as tenants
by entirety. When John dies the home is valued at $350,000. How much
will be counted in his gross taxable estate?
A. None, as it passes directly to his spouse, Jean.
B. $175,000 - or one-half of the value
C. $225,000 - or the full amount minus the $125,000 one-time exclusion
for capital gains on a person residence.
D. $350,000 - the full amount is includable. - ACCURATE
ANSWERS✔✔ B. $175,000 - or one-half the value
Once a will is properly drafted it is valid:
A. in all states.
B. for the state for which it was prepared.
C. in all states for a period of 5 years.
D. for the state for which it was prepared for a period of 5 years. -
ACCURATE ANSWERS✔✔ B. for the state for which it was prepared.
,In managing personal trust assets, a trustee should seek which of the
following?
A. maximum income
B. preservation of capital
C. reasonable income and preservation of capital, including purchasing
power
D. maximum income and reasonable preservation of capital -
ACCURATE ANSWERS✔✔ C. reasonable income and preservation of
capital including purchasing power
A decedent's estate being settled by your bank contains an antique
automobile. One of the directors of your bank indicates that he would
like to buy it. You should do which of the following?
A. Sell it to him at a bargain price and befriend him.
B. Have a qualified appraisal done and offer it to him at that value.
C. Explain that he may not purchase the car from the estate.
D. Arrange for a public auction at which he may buy it if he is the
highest bidder. - ACCURATE ANSWERS✔✔ C. Explain that he may
not purchase the car from the estate.
EXAMLINKS
STUDY SMART,
,If you hold a rental property in an irrevocable trust, when is it all right to
rent to an employee of your trust department?
A. Never
B. When the employee pays fair rent.
C. When the employee has been with you at least 5 years and can be
trusted.
D. When the employee has no connection with the account or
beneficiaries. - ACCURATE ANSWERS✔✔ A. Never
Which of the following generally may NOT hold real property?
A. Revocable Living Trusts trusteed by a corporate fiduciary.
B. Uniform Gift to Minors Account
C. 2503(c) Minors Trust
D. Uniform Transfer to Minors Account - ACCURATE ANSWERS✔✔
B. Uniform Gifts to Minors Account
H's will provides that upon his death, $1 million will be held in a trust
for the benefit of his wife, W. This trust provides that W will receive all
of the trust income and will receive distributions of principal int he form
of an annuity for her lifetime. At W's death, the remaining trust assets
will be distributed to a designated charity. H's executor intends to make
EXAMLINKS
STUDY SMART,
, a "QTIP" election for this trust. Will the legacy to the trust, or any part
thereof, be deductible by H's estate, or if so, why?
A. Yes, the entire $1 million will qualify for the estate tax marital and
charitable deductions.
B. No, none of the $1 million will qualify for the estate tax marital and
charitable deductions.
C. Yes, the entire $1 million will qualify for the estate tax marital
deduction.
D. Yes, the value of W's income interest will qualify for the marital
deduction; the remainder will not qualify for any deduction. -
ACCURATE ANSWERS✔✔ C. Yes, the entire $1 million will qualify
for the estate tax marital deduction.
H makes a gift of property to a trust for the benefit of his children. If H
serves as a trustee, what limitations, if any, should be placed on his
distribution powers in order to avoid adverse gift and estate tax
consequences?
A. H's power to make distributions should be limited by ascertainable
standards such as health, support and education.
B. No limitations are required.
C. H should be prohibited from participating in making any
distributions.
EXAMLINKS
STUDY SMART,
