All the following are grounds for contesting a will EXCEPT:

A. The testator executed a later valid will.

B. The instrument is a forgery.

C. The widow was bequeathed less than her intestate share.

D. The testator did not have testamentary capacity.

A married man has two adult sons. His entire estate is in excess of $1,500,000 and consists entirely of probate assets. He wants to make certain that if he predeceases his wife she will receive all estate income as long as she lives, and the assets remaining at her death will pass equally to their two sons. He wants to pass all assets to this wife and sons as free of federal estate taxes as possible. To best accomplish these objectives, the man should include which of the following estate plans in his will?

A. Establish a marital deduction trust with a general power of appointment for half his estate and place the

remainder in a QTIP trust

B. Establish a QTIP trust for half his estate and bequeath the remainder to his wife

C. Establish a QTIP trust for his entire estate

D. Establish a bypass trust equal to the applicable exclusion amount and place the remainder of his estate in a QTIP trust

Which of the following statements concerning estates and trusts is (are) correct?1. Both estates and trusts come into being by operation of law. 2. The personal representative of an estate and the trustee have similar fiduciary responsibilities.

A. Both 1 and 2

B. 1 only

C. Neither 1 nor 2

D. 2 only

A man recently died with only probate assets. Under the terms of his will, he left his entire probate estate outright to his wife. The following are relevant facts about the estate:

-Gross estate $1,700,000

-Estate administration expenses 30,000

-Debts of decedent 65,000

-

Allowable funeral expenses 5,000

A.

$1,635,000

B.

$1,695,000

C.

$1,665,000

D.

$1,600,000

When the owner of a closely held business dies, the payment of a portion of the federal estate tax may be deferred for a period of several years if the estate otherwise qualifies under the provisions of IRC Section 6166. Which of the following statements concerning this deferral of federal estate tax is correct?

A. To qualify for the tax deferral, the closely held business must represent more than 50 percent of the value of the decedent's adjusted gross estate.

B. Under certain circumstances, the estate will forfeit its right to tax deferral, and all the remaining unpaid estate tax will become due and payable immediately.

C. The interest on the unpaid estate tax is payable over the first 10 years, after which the tax plus interest on the balance is payable in equal installments for the last 5 years.

D. The interest rate on the deferred tax is determined by the prime rate in effect on the date of death.

Which of the following statements concerning pooled-income funds is (are) correct?

1.

A pooled income fund is similar to a mutual fund maintained by a qualified charity.

2.

It is an irrevocable arrangement in which the remainder interest passes to charity.

A. Both 1 and 2

B. 2 only

C. Neither 1 nor 2

D. 1 only

A woman is the income beneficiary of an irrevocable trust. Which of the following powers given to her will cause all the assets in the trust to be includible in her gross estate for federal estate tax purposes?

A. The testamentary special or limited power to direct the trustee to distribute trust assets to her children

B. The testamentary power to direct the trustee to use trust assets to pay her estate taxes

C. The power each year to direct the trustee to pay her an amount of trust assets not exceeding the greater of $5,000 or 5 percent of the assets held by the trust

D. The power to direct the trustee to pay trust assets to her limited in amount to an ascertainable standard relating to her health and education

All the following are conditions that must be met if an otherwise nonqualified terminable interest is to qualify (as QTIP) for the federal estate tax marital deduction EXCEPT:

A. The surviving spouse must make a qualified disclaimer to all other property in the deceased spouse's estate within 9 months of death.

B. The surviving spouse must be given a lifetime right to receive all the property's income at least annually.

C. The deceased spouse's executor must make an irrevocable election to have the property includible in the surviving spouse's gross estate.

D. No person can be given the right to direct that the property go to anyone other than the surviving spouse as long as the surviving spouse is alive.

A father and son have been farming land owned by the father for the past 12 years. Just prior to his death, the father was offered $900,000 for his farm because of its possible use as a shopping center. The son would like to continue to farm the land if it can be included in his father's estate at its current use value. Additional facts are:

1.Average annual gross rentals from nearby farms of similar acreage are $36,000.

2.Average annual state and local real estate taxes on the farm are $4,000.

3.The interest rate for loans from the Federal Land Bank is 8 percent. For federal estate tax purposes, the farm method valuation formula would result in a current use value for the farm of

A. $600,000

B. $300,000

C. $500,000

D. $400,000

All the following statements concerning the generation-skipping transfer tax (GSTT) are correct EXCEPT:

A. All donors have a cumulative $1.5 million exemption against generation-skipping transfers.

B. The tax is imposed according to a graduated rate schedule similar to the federal estate and gift tax rates.

C. The tax may be imposed on direct gifts to grandchildren.

D. The tax may be imposed on gifts in trust to grandchildren.