Estate Planning Exam 2 questions and
answers graded A+
excise tax - correct answer ✔✔ a tax on a transaction, it is levied on the transfer of wealth with
the tax based on the net value of property transferred
Two taxes in unified transfer tax system - correct answer ✔✔ gift tax and estate tax, both use
the same tax rate schedule and both tax the net value of the wealth that is transferred
Gifts are valued as of - correct answer ✔✔ DOG - date the gift is given
estates are valued as of - correct answer ✔✔ DOD - date of death
applicable exclusion amount (AEA) - correct answer ✔✔ Credit applicable to the amount of
federal estate tax owed by the person at death, the amount that is sheltered by the unified
credit
AEA exclusion per person - correct answer ✔✔ 12.06 million
AEA exclusion for a married couple - correct answer ✔✔ 24.12 million
sunset provision - correct answer ✔✔ A provision attached to new tax legislation that will cause
such legislation to expire at a specified date.
Annual exclusion for gifts - correct answer ✔✔ $16,000 per person, $32,000 per married couple
, QDOT (Qualified Domestic Trust) - correct answer ✔✔ when one spouse is not a US citizen, you
can put everything into the trust and the spouse gets the benefit during their life and not taxed
until their death
if your spouse is a non US citizen - correct answer ✔✔ does not receive the marital exclusion,
can gift them $164,000 annually without it being taxed, use a QDOT, or they can become a US
citizen within 9 months
Unlimited Marital Deduction (UMD) - correct answer ✔✔ you can give an unlimited amount to
your spouse at death without it being taxed, but they have to be a US citizen
Portability - correct answer ✔✔ a way for spouses to combine their exemption from estate and
gift tax. More specifically, it's a process where a surviving spouse can pick up and use the
unused estate tax exemption of a deceased spouse.
if someone has multiple spouses that pass, they only received the exclusion of... - correct
answer ✔✔ the spouse that most recently passed
Single client passes, they can get rid of - correct answer ✔✔ debts and administration costs,
charity, state estate taxes to calculate their new exclusion amount
excluded from the estate - correct answer ✔✔ post gift income, post gift increases in value and
the annual exclusion
people that do not have to worry about capital gains tax - correct answer ✔✔ if they are
receiving a house and do not plan on selling it right away, or people who will use it for a closely
held business
capital gains tax exclusion - correct answer ✔✔ $250,000 single
$500,000 married
answers graded A+
excise tax - correct answer ✔✔ a tax on a transaction, it is levied on the transfer of wealth with
the tax based on the net value of property transferred
Two taxes in unified transfer tax system - correct answer ✔✔ gift tax and estate tax, both use
the same tax rate schedule and both tax the net value of the wealth that is transferred
Gifts are valued as of - correct answer ✔✔ DOG - date the gift is given
estates are valued as of - correct answer ✔✔ DOD - date of death
applicable exclusion amount (AEA) - correct answer ✔✔ Credit applicable to the amount of
federal estate tax owed by the person at death, the amount that is sheltered by the unified
credit
AEA exclusion per person - correct answer ✔✔ 12.06 million
AEA exclusion for a married couple - correct answer ✔✔ 24.12 million
sunset provision - correct answer ✔✔ A provision attached to new tax legislation that will cause
such legislation to expire at a specified date.
Annual exclusion for gifts - correct answer ✔✔ $16,000 per person, $32,000 per married couple
, QDOT (Qualified Domestic Trust) - correct answer ✔✔ when one spouse is not a US citizen, you
can put everything into the trust and the spouse gets the benefit during their life and not taxed
until their death
if your spouse is a non US citizen - correct answer ✔✔ does not receive the marital exclusion,
can gift them $164,000 annually without it being taxed, use a QDOT, or they can become a US
citizen within 9 months
Unlimited Marital Deduction (UMD) - correct answer ✔✔ you can give an unlimited amount to
your spouse at death without it being taxed, but they have to be a US citizen
Portability - correct answer ✔✔ a way for spouses to combine their exemption from estate and
gift tax. More specifically, it's a process where a surviving spouse can pick up and use the
unused estate tax exemption of a deceased spouse.
if someone has multiple spouses that pass, they only received the exclusion of... - correct
answer ✔✔ the spouse that most recently passed
Single client passes, they can get rid of - correct answer ✔✔ debts and administration costs,
charity, state estate taxes to calculate their new exclusion amount
excluded from the estate - correct answer ✔✔ post gift income, post gift increases in value and
the annual exclusion
people that do not have to worry about capital gains tax - correct answer ✔✔ if they are
receiving a house and do not plan on selling it right away, or people who will use it for a closely
held business
capital gains tax exclusion - correct answer ✔✔ $250,000 single
$500,000 married
