Certified Estate Planning – Final Exam
(2025/2026 Latest Exam Prep) | Complete
Study Guide & Verified Q&A
You are a CFP certificant with ABC Financial Solutions. A client has come to you for
estate planning assistance. You should inform the client of which of the following?
I. You cannot ethically provide the client with any estate planning assistance and must
refer the case in its entirety to an attorney.
II. You can be involved in data gathering, identifying estate planning goals, and
identifying possible weaknesses and problem areas in the client's current situation.
III. Your role will be working with and coordinating specialists such as attorneys,
accountants, and trust officers whose expertise will be necessary to analyze tax and
legal implications of suggested actions and to draft needed documents.
IV. You can review the client's current estate planning documents to interpret the
contents and indicate what the legal implications of the document are for the client.
A. II, III, and IV
B. II and III
C. III only - correct answerB. II and III
Both statements II and III are legitimate and accepted roles of a non-attorney financial
planner in the estate planning process. The other answers are incorrect for various
reasons. A financial planner is not legally or ethically prohibited from assisting a client
with his or her estate plan. Interpreting the contents of a client's estate planning
documents and informing him or her of the legal implications of those documents is not
part of the non-attorney financial planner's role in estate planning since it usually
involves interpretation of state law, which is considered the unauthorized practice of
law.
LO 1.1.1
Which of the following statements regarding the goals of estate planning is CORRECT?
A. An estate planner is in the best position to determine which goals the client should
prioritize.
B. An estate planner must choose between two or more estate planning techniques that
will achieve his or her client's objectives.
C. A client and an estate planner must mutually agree on the client's most important
estate planning objective in the event that all such objectives cannot be satisfied.
D. A client may have to choose between two or more estate planning techniques that
will achieve his or her objectives. - correct answerD. A client may have to choose
between two or more estate planning techniques
that will achieve his or her objectives.
,Although there may be two or more techniques that will achieve the client's stated
objectives, the client's choice will be based on a preference for one technique's
characteristics or tax consequences over those of the other technique(s).
LO 1.2.1
Your client has an estate valued at $4 million. Two months ago, his wife died. He and
his now deceased wife did not have any children together, but she had two children
from a prior marriage. His will, drafted in 2012, leaves everything to his wife. No
contingent beneficiary is named in the will, and it does not contain a residuary clause.
Included in the client's estate are real estate holdings in three other states. He wants to
retain lifetime ownership of these properties because of the income they provide him.
He would like the real estate holdings to pass to his wife's children in equal shares upon
his death. He would like the remainder of his estate to go to his brother.
Which of the following are serious estate planning pitfalls that can be avoided if your
client amends his will to carry out his objectives?
I. Having the estate pass under the laws of intestacy
II. Having the estate assets distributed through - correct answerD. I and IV
Statement II is false because probate, especially from CFP Board's perspective, should
be avoided and wills go through probate. Statement III is false because amending a will
won't have any effect on the estate tax calculation, and the estate isn't even close to
large enough to worry about estate taxes.
LO 1.2.2
Your client, Rafer, owns a vacation home in another state. Rafer recently married for the
second time and wants to include his new wife, Edna, on the title to the vacation home.
At your last client meeting, he stated that his primary concern is that this property be left
to Edna outside probate at his death while restricting her disposition of the property prior
to his death without his consent. Rafer revoked his old will upon his marriage to Edna,
but has not yet executed a new will.
You are researching property ownership to identify the most appropriate form of titling
for the vacation home in preparation for your next meeting with your client and his
attorney. Which one of the following statements presents the most appropriate form of
titling for the vacation home?
A. Tenancy by the entirety will prevent lifetime disposition without Rafer's consent.
B. Tenancy in common with Edna will eliminate the need for anci - correct answerA.
Tenancy by the entirety will prevent lifetime disposition without Rafer's consent.
Tenancy by the entirety has a survivorship feature, which will pass the property to Edna
outside of probate and will not allow Edna to transfer her interest while Rafer is alive
without his consent
, - Joint tenancy would allow Edna to transfer her interest without Rafer's consent, and
because the form of property ownership does not affect either owner's right to make a
will.
- Tenancy in common would neither eliminate the need for probate nor prevent Edna
from selling her interest.
- Sole ownership by Rafer would require probate to transfer the property to Edna, plus
she would have no interest in the property until Rafer died.
LO 1.3.1
Last year, your client and his wife gave their adult son a one-third interest in a
commercial office building. Each has a one-third interest as tenants in common.
If your client dies while still owning the property as a tenant in common, an estate tax
implication of this form of property ownership is that
A. your client's estate will be entitled automatically to a marital deduction of one-half of
the date-of-death value.
B. one-third of the value of the property will be included in your client's gross estate.
C. one-half of the value of the property will be included in your client's gross estate.
D. the entire value of the property will be included in your client's gross estate because
his estate cannot prove contribution by the other tenants in common. - correct answerB.
one-third of the value of the property will be included in your client's gross estate.
Each tenant in common owns their share of the property and as owner, that share is
included in the gross estate of each.
LO 1.3.1
Lou inherited a parcel of real estate. Five years ago, he changed the title to joint
tenancy with right of survivorship (JTWROS) with his wife, Eve. Lou would like to will the
property to John, his son from a previous marriage, so John can use the property to
start a business.
What is one disadvantage of holding the property in its current form?
A. If Lou predeceases Eve, the property will pass to Eve as surviving joint tenant without
regard to the terms of Lou's will.
B. The property will be included in Lou's gross estate based upon his relative
contribution.
C. Lou's one-half will not qualify for the marital deduction when it passes to Eve.
D. The testamentary transfer from Lou to John will occur without Eve's consent. -
correct answerA. If Lou predeceases Eve, the property will pass to Eve as surviving
joint tenant without regard to the terms of Lou's will.
By owning the property as JTWROS, Lou can only transfer his interest in the property to
John in his will if he survives Eve. If Lou dies before Eve, the property will pass to her by
right of survivorship. Lou's interest would qualify for the marital deduction when it
, passes to Eve. The relative contributions toward purchasing the property are irrelevant
with spouses. Each spouse is defined by law as having contributed half. Also, even
though Lou has made no contribution to acquire this property (it was inherited), his
original basis would be the stepped-up basis from the person from whom he inherited
the property. If he dies before Eve, Lou's will can have no effect upon JTWROS
property. None of the property will be received by John if Lou predeceases Eve unless
the current ownership form is changed.
LO 1.3.2
Sharon gives Patrick the absolute right to use her vacation house for life and upon
Patrick's death, all rights to the house are assumed by Sharon again. What types of
property interests do Sharon and Patrick have, respectively?
A. Reversion and life estate
B. Fee simple estate and reversion
C. Life estate and reversion
D. Interest for a term of years and life estate - correct answerA. Reversion and life
estate
Sharon has a reversion, because she receives the property back when Patrick dies (i.e.,
the property reverts to her). Patrick has a life estate, because he is entitled to use and
possess the property during his life.
LO 1.3.2
Which statement regarding bank accounts owned jointly with right of survivorship
(JTWROS) is CORRECT?
A. There are no gift tax consequences with JTWROS accounts.
B. A gift is made upon the creation of the donee's interest.
C. There is a gift whenever a person uses personal funds to open a joint bank account.
D. A gift is made when the noncontributing joint owner (the donee) makes withdrawals. -
correct answerD. A gift is made when the noncontributing joint owner (the donee)
makes withdrawals.
There is no gift when a person uses personal funds to open a joint bank account. There
is a gift when the other joint owner (the donee) makes a withdrawal—the gift is the
amount withdrawn
LO 1.3.2
Andrew and Alicia are husband and wife who live in a community property state. Soon
after their marriage they began establishing an emergency fund using money that each
earned from their respective jobs. This fund was used to meet unexpected expenses as
they arose. Three years ago, Alicia liquidated a bond fund that she had purchased prior
to their marriage, and placed the proceeds in the emergency fund. There have been
many deposits and withdrawals from the fund since that time. Last year, Andrew filed for
divorce.
(2025/2026 Latest Exam Prep) | Complete
Study Guide & Verified Q&A
You are a CFP certificant with ABC Financial Solutions. A client has come to you for
estate planning assistance. You should inform the client of which of the following?
I. You cannot ethically provide the client with any estate planning assistance and must
refer the case in its entirety to an attorney.
II. You can be involved in data gathering, identifying estate planning goals, and
identifying possible weaknesses and problem areas in the client's current situation.
III. Your role will be working with and coordinating specialists such as attorneys,
accountants, and trust officers whose expertise will be necessary to analyze tax and
legal implications of suggested actions and to draft needed documents.
IV. You can review the client's current estate planning documents to interpret the
contents and indicate what the legal implications of the document are for the client.
A. II, III, and IV
B. II and III
C. III only - correct answerB. II and III
Both statements II and III are legitimate and accepted roles of a non-attorney financial
planner in the estate planning process. The other answers are incorrect for various
reasons. A financial planner is not legally or ethically prohibited from assisting a client
with his or her estate plan. Interpreting the contents of a client's estate planning
documents and informing him or her of the legal implications of those documents is not
part of the non-attorney financial planner's role in estate planning since it usually
involves interpretation of state law, which is considered the unauthorized practice of
law.
LO 1.1.1
Which of the following statements regarding the goals of estate planning is CORRECT?
A. An estate planner is in the best position to determine which goals the client should
prioritize.
B. An estate planner must choose between two or more estate planning techniques that
will achieve his or her client's objectives.
C. A client and an estate planner must mutually agree on the client's most important
estate planning objective in the event that all such objectives cannot be satisfied.
D. A client may have to choose between two or more estate planning techniques that
will achieve his or her objectives. - correct answerD. A client may have to choose
between two or more estate planning techniques
that will achieve his or her objectives.
,Although there may be two or more techniques that will achieve the client's stated
objectives, the client's choice will be based on a preference for one technique's
characteristics or tax consequences over those of the other technique(s).
LO 1.2.1
Your client has an estate valued at $4 million. Two months ago, his wife died. He and
his now deceased wife did not have any children together, but she had two children
from a prior marriage. His will, drafted in 2012, leaves everything to his wife. No
contingent beneficiary is named in the will, and it does not contain a residuary clause.
Included in the client's estate are real estate holdings in three other states. He wants to
retain lifetime ownership of these properties because of the income they provide him.
He would like the real estate holdings to pass to his wife's children in equal shares upon
his death. He would like the remainder of his estate to go to his brother.
Which of the following are serious estate planning pitfalls that can be avoided if your
client amends his will to carry out his objectives?
I. Having the estate pass under the laws of intestacy
II. Having the estate assets distributed through - correct answerD. I and IV
Statement II is false because probate, especially from CFP Board's perspective, should
be avoided and wills go through probate. Statement III is false because amending a will
won't have any effect on the estate tax calculation, and the estate isn't even close to
large enough to worry about estate taxes.
LO 1.2.2
Your client, Rafer, owns a vacation home in another state. Rafer recently married for the
second time and wants to include his new wife, Edna, on the title to the vacation home.
At your last client meeting, he stated that his primary concern is that this property be left
to Edna outside probate at his death while restricting her disposition of the property prior
to his death without his consent. Rafer revoked his old will upon his marriage to Edna,
but has not yet executed a new will.
You are researching property ownership to identify the most appropriate form of titling
for the vacation home in preparation for your next meeting with your client and his
attorney. Which one of the following statements presents the most appropriate form of
titling for the vacation home?
A. Tenancy by the entirety will prevent lifetime disposition without Rafer's consent.
B. Tenancy in common with Edna will eliminate the need for anci - correct answerA.
Tenancy by the entirety will prevent lifetime disposition without Rafer's consent.
Tenancy by the entirety has a survivorship feature, which will pass the property to Edna
outside of probate and will not allow Edna to transfer her interest while Rafer is alive
without his consent
, - Joint tenancy would allow Edna to transfer her interest without Rafer's consent, and
because the form of property ownership does not affect either owner's right to make a
will.
- Tenancy in common would neither eliminate the need for probate nor prevent Edna
from selling her interest.
- Sole ownership by Rafer would require probate to transfer the property to Edna, plus
she would have no interest in the property until Rafer died.
LO 1.3.1
Last year, your client and his wife gave their adult son a one-third interest in a
commercial office building. Each has a one-third interest as tenants in common.
If your client dies while still owning the property as a tenant in common, an estate tax
implication of this form of property ownership is that
A. your client's estate will be entitled automatically to a marital deduction of one-half of
the date-of-death value.
B. one-third of the value of the property will be included in your client's gross estate.
C. one-half of the value of the property will be included in your client's gross estate.
D. the entire value of the property will be included in your client's gross estate because
his estate cannot prove contribution by the other tenants in common. - correct answerB.
one-third of the value of the property will be included in your client's gross estate.
Each tenant in common owns their share of the property and as owner, that share is
included in the gross estate of each.
LO 1.3.1
Lou inherited a parcel of real estate. Five years ago, he changed the title to joint
tenancy with right of survivorship (JTWROS) with his wife, Eve. Lou would like to will the
property to John, his son from a previous marriage, so John can use the property to
start a business.
What is one disadvantage of holding the property in its current form?
A. If Lou predeceases Eve, the property will pass to Eve as surviving joint tenant without
regard to the terms of Lou's will.
B. The property will be included in Lou's gross estate based upon his relative
contribution.
C. Lou's one-half will not qualify for the marital deduction when it passes to Eve.
D. The testamentary transfer from Lou to John will occur without Eve's consent. -
correct answerA. If Lou predeceases Eve, the property will pass to Eve as surviving
joint tenant without regard to the terms of Lou's will.
By owning the property as JTWROS, Lou can only transfer his interest in the property to
John in his will if he survives Eve. If Lou dies before Eve, the property will pass to her by
right of survivorship. Lou's interest would qualify for the marital deduction when it
, passes to Eve. The relative contributions toward purchasing the property are irrelevant
with spouses. Each spouse is defined by law as having contributed half. Also, even
though Lou has made no contribution to acquire this property (it was inherited), his
original basis would be the stepped-up basis from the person from whom he inherited
the property. If he dies before Eve, Lou's will can have no effect upon JTWROS
property. None of the property will be received by John if Lou predeceases Eve unless
the current ownership form is changed.
LO 1.3.2
Sharon gives Patrick the absolute right to use her vacation house for life and upon
Patrick's death, all rights to the house are assumed by Sharon again. What types of
property interests do Sharon and Patrick have, respectively?
A. Reversion and life estate
B. Fee simple estate and reversion
C. Life estate and reversion
D. Interest for a term of years and life estate - correct answerA. Reversion and life
estate
Sharon has a reversion, because she receives the property back when Patrick dies (i.e.,
the property reverts to her). Patrick has a life estate, because he is entitled to use and
possess the property during his life.
LO 1.3.2
Which statement regarding bank accounts owned jointly with right of survivorship
(JTWROS) is CORRECT?
A. There are no gift tax consequences with JTWROS accounts.
B. A gift is made upon the creation of the donee's interest.
C. There is a gift whenever a person uses personal funds to open a joint bank account.
D. A gift is made when the noncontributing joint owner (the donee) makes withdrawals. -
correct answerD. A gift is made when the noncontributing joint owner (the donee)
makes withdrawals.
There is no gift when a person uses personal funds to open a joint bank account. There
is a gift when the other joint owner (the donee) makes a withdrawal—the gift is the
amount withdrawn
LO 1.3.2
Andrew and Alicia are husband and wife who live in a community property state. Soon
after their marriage they began establishing an emergency fund using money that each
earned from their respective jobs. This fund was used to meet unexpected expenses as
they arose. Three years ago, Alicia liquidated a bond fund that she had purchased prior
to their marriage, and placed the proceeds in the emergency fund. There have been
many deposits and withdrawals from the fund since that time. Last year, Andrew filed for
divorce.
