Series 65 Test Geek Exam 2025
Questions and Answers
what does limited liability for a company mean? - ANSWER✔✔-liable to the extend of your
investment (capital in the business)
ease of business entity formation from easiest to difficult - ANSWER✔✔-sole proprietorship, LLC,
S-Corp, general partnership, C-Corp
what business entities have full liability? - ANSWER✔✔-sole proprietorship and general partner
what business entities have limited liability? - ANSWER✔✔-LLC, S-Corp, C-Corp
what business entities have the owner responsible for taxes? - ANSWER✔✔-sole proprietorship,
LLC, S-Corp, general partnership
what business entities have tax obligations at the business level? - ANSWER✔✔-C-Corp
what is the tax form for a trust? - ANSWER✔✔-1041
living trust - ANSWER✔✔-must be created while settlor is alive
if a client is in the hospital in a coma, what type of trust would you set up? - ANSWER✔✔-living
trust (they are still alive)
FOR STUDY PURPOSES ONLY COPYRIGHT © 2025 ALL RIGHTS RESERVED 1
,testamentary trust - ANSWER✔✔-based on client's will - only created once they die
advisor learned their client recently became deceased and from the client's will a testamentary trust
has been discovered. who would you want to contact?
a. spouse
b. attorney
c. CPA
d. executor - ANSWER✔✔-d. executor
what is another name for a trust executor? - ANSWER✔✔-administrator
simple trust setup - ANSWER✔✔-must distribute income annually
how is a simple trust taxed? - ANSWER✔✔-annually
complex trust setup - ANSWER✔✔-may accumulate income
how is a complex trust taxed? - ANSWER✔✔-only taxed if there is a distribution
settlor - ANSWER✔✔-person who creates a trust
what is another name for a settlor? - ANSWER✔✔-grantor
per stirpes - ANSWER✔✔-if beneficiary dies their portion will be split among their heirs
FOR STUDY PURPOSES ONLY COPYRIGHT © 2025 ALL RIGHTS RESERVED 2
, per capita - ANSWER✔✔-if beneficiary dies the trust is reallocation to include the heirs
proportionately
raindermen - ANSWER✔✔-heirs to a beneficiary in a trust
a trust has two names beneficiaries, how is it managed?
a. based on each beneficiaries individual needs
b. based upon states objective in trust agreement
c. based on the proportion each beneficiary will receive
d. based on the advisor's recommendation - ANSWER✔✔-b. based upon states objective in trust
agreement
individual's balance sheet formula - ANSWER✔✔-assets - liabilities = net worth
what do individual and corporate balance sheets have in common? - ANSWER✔✔-usually both
have a mortgage
what are assets on an individual balance sheet? - ANSWER✔✔-- property (primary residence,
vacation home, investment property)
- investments (investment accts, retirement accts
-cash
-jewelry
what are liabilities on an individual balance sheet? - ANSWER✔✔--mortgages
FOR STUDY PURPOSES ONLY COPYRIGHT © 2025 ALL RIGHTS RESERVED 3
Questions and Answers
what does limited liability for a company mean? - ANSWER✔✔-liable to the extend of your
investment (capital in the business)
ease of business entity formation from easiest to difficult - ANSWER✔✔-sole proprietorship, LLC,
S-Corp, general partnership, C-Corp
what business entities have full liability? - ANSWER✔✔-sole proprietorship and general partner
what business entities have limited liability? - ANSWER✔✔-LLC, S-Corp, C-Corp
what business entities have the owner responsible for taxes? - ANSWER✔✔-sole proprietorship,
LLC, S-Corp, general partnership
what business entities have tax obligations at the business level? - ANSWER✔✔-C-Corp
what is the tax form for a trust? - ANSWER✔✔-1041
living trust - ANSWER✔✔-must be created while settlor is alive
if a client is in the hospital in a coma, what type of trust would you set up? - ANSWER✔✔-living
trust (they are still alive)
FOR STUDY PURPOSES ONLY COPYRIGHT © 2025 ALL RIGHTS RESERVED 1
,testamentary trust - ANSWER✔✔-based on client's will - only created once they die
advisor learned their client recently became deceased and from the client's will a testamentary trust
has been discovered. who would you want to contact?
a. spouse
b. attorney
c. CPA
d. executor - ANSWER✔✔-d. executor
what is another name for a trust executor? - ANSWER✔✔-administrator
simple trust setup - ANSWER✔✔-must distribute income annually
how is a simple trust taxed? - ANSWER✔✔-annually
complex trust setup - ANSWER✔✔-may accumulate income
how is a complex trust taxed? - ANSWER✔✔-only taxed if there is a distribution
settlor - ANSWER✔✔-person who creates a trust
what is another name for a settlor? - ANSWER✔✔-grantor
per stirpes - ANSWER✔✔-if beneficiary dies their portion will be split among their heirs
FOR STUDY PURPOSES ONLY COPYRIGHT © 2025 ALL RIGHTS RESERVED 2
, per capita - ANSWER✔✔-if beneficiary dies the trust is reallocation to include the heirs
proportionately
raindermen - ANSWER✔✔-heirs to a beneficiary in a trust
a trust has two names beneficiaries, how is it managed?
a. based on each beneficiaries individual needs
b. based upon states objective in trust agreement
c. based on the proportion each beneficiary will receive
d. based on the advisor's recommendation - ANSWER✔✔-b. based upon states objective in trust
agreement
individual's balance sheet formula - ANSWER✔✔-assets - liabilities = net worth
what do individual and corporate balance sheets have in common? - ANSWER✔✔-usually both
have a mortgage
what are assets on an individual balance sheet? - ANSWER✔✔-- property (primary residence,
vacation home, investment property)
- investments (investment accts, retirement accts
-cash
-jewelry
what are liabilities on an individual balance sheet? - ANSWER✔✔--mortgages
FOR STUDY PURPOSES ONLY COPYRIGHT © 2025 ALL RIGHTS RESERVED 3
