CANNON CTFA EXAM 2025 WITH 100%
ACCURATE SOLUTIONS
1. Which of the following is provided in the Employee Retirement Income
Security Act of 1974 (ERISA)?
minimum funding requirements for defined benefit, funded
pension plans.
requirement that defined benefit pension plans be funded with an
independent, third party trustee
requirement that any transition asset/obligation be amortized over
the expected service life of employees participating in the pension
plan.
requirement that defined benefit, funded pension plans be
noncontributory.
2. Describe the implications of making a QTIP election for the trust
established by H in terms of estate tax deductions.
Making a QTIP election means the trust will not qualify for any
deductions.
Making a QTIP election only benefits the charity named in the trust.
Making a QTIP election allows the estate to avoid all estate taxes.
Making a QTIP election allows the estate to deduct the value of
the trust for the marital deduction, as W receives income for her
lifetime.
3. If the decedent had earned an additional $10,000 after September 18, how
,would this affect the income reported on the estate's initial 1041 income tax
return?
, The income reported would remain $60,000.
The income reported would increase to $85,000.
The income reported would increase to $70,000.
The income reported would depend on the estate's fiscal year.
4. Which of the following is not a qualifying event that permits conversion of a
NICRUT to a STANCRUT?
The trust beneficiary's 60th birthday
All of the above are qualifying events
The sale of a parcel of real estate held in the trust
The grantor's investment advisor determines that a change in
investment strategy is desirable
5. Which of the following trusts must provide the surviving spouse with
income, but need not provide the spouse with rights to the principal, nor
the right to designate who should receive the principal?
QTIP trust
Crummey Trust
Testamentary trust
Bypass Trust
6. If the decedent had earned an additional $10,000 after September 18, how
would this affect the income reported on the estate's initial income tax
return?
The estate would report $85,000, including all income earned.
The estate would report $10,000, as it is the only income after death.
, The estate would report $70,000, including the additional income.
The estate would still report $60,000, as income earned after
death is not included.
7. If a trustee is faced with an investment opportunity that promises high
returns but poses a significant risk to capital, what should the trustee
consider based on their responsibilities?
The trustee should consider the balance between reasonable
income and preservation of capital, including the potential impact
on purchasing power.
The trustee should avoid all investments that could affect capital
preservation.
The trustee should consult beneficiaries before making any
investment decisions.
The trustee should prioritize the high returns regardless of the risk to
capital.
8. What type of election does H's executor intend to make for the trust?
QTIP election
Charitable election
Marital election
GST election
9. Which type of bonds is taxable at both the Federal and State levels?
Corporate bonds
In state municipal bonds
ACCURATE SOLUTIONS
1. Which of the following is provided in the Employee Retirement Income
Security Act of 1974 (ERISA)?
minimum funding requirements for defined benefit, funded
pension plans.
requirement that defined benefit pension plans be funded with an
independent, third party trustee
requirement that any transition asset/obligation be amortized over
the expected service life of employees participating in the pension
plan.
requirement that defined benefit, funded pension plans be
noncontributory.
2. Describe the implications of making a QTIP election for the trust
established by H in terms of estate tax deductions.
Making a QTIP election means the trust will not qualify for any
deductions.
Making a QTIP election only benefits the charity named in the trust.
Making a QTIP election allows the estate to avoid all estate taxes.
Making a QTIP election allows the estate to deduct the value of
the trust for the marital deduction, as W receives income for her
lifetime.
3. If the decedent had earned an additional $10,000 after September 18, how
,would this affect the income reported on the estate's initial 1041 income tax
return?
, The income reported would remain $60,000.
The income reported would increase to $85,000.
The income reported would increase to $70,000.
The income reported would depend on the estate's fiscal year.
4. Which of the following is not a qualifying event that permits conversion of a
NICRUT to a STANCRUT?
The trust beneficiary's 60th birthday
All of the above are qualifying events
The sale of a parcel of real estate held in the trust
The grantor's investment advisor determines that a change in
investment strategy is desirable
5. Which of the following trusts must provide the surviving spouse with
income, but need not provide the spouse with rights to the principal, nor
the right to designate who should receive the principal?
QTIP trust
Crummey Trust
Testamentary trust
Bypass Trust
6. If the decedent had earned an additional $10,000 after September 18, how
would this affect the income reported on the estate's initial income tax
return?
The estate would report $85,000, including all income earned.
The estate would report $10,000, as it is the only income after death.
, The estate would report $70,000, including the additional income.
The estate would still report $60,000, as income earned after
death is not included.
7. If a trustee is faced with an investment opportunity that promises high
returns but poses a significant risk to capital, what should the trustee
consider based on their responsibilities?
The trustee should consider the balance between reasonable
income and preservation of capital, including the potential impact
on purchasing power.
The trustee should avoid all investments that could affect capital
preservation.
The trustee should consult beneficiaries before making any
investment decisions.
The trustee should prioritize the high returns regardless of the risk to
capital.
8. What type of election does H's executor intend to make for the trust?
QTIP election
Charitable election
Marital election
GST election
9. Which type of bonds is taxable at both the Federal and State levels?
Corporate bonds
In state municipal bonds
