Chapter 19 – Estate Planning
113. (p. 649) A legal arrangement through which your assets are held by a trustee for your
benefit or that of your beneficiaries is called a:
114. (p. 649) If you establish a(n) ____________ trust, you retain the right to end the trust or
change its terms.
115. (p. 649) If you establish a(n) ____________ trust, you cannot change its terms or end it.
Chapter 19 – Estate Planning
116. (p. 650) A(n) ____________ trust is a property management arrangement that you establish
while you are alive.
117. (p. 652) A trust established by your will that becomes effective upon your death is called
a(n) ____________ trust.
118. (p. 655) Under what type of ownership is the property considered owned 50-50 for estate
tax purposes and passed automatically to your spouse at your death?
Chapter 19 – Estate Planning
119. (p. 655) In what type of joint ownership may neither spouse sell the property without the
consent of the other?
120. (p. 650) A surgeon who will soon finish paying off college loans might want to set up a(n):
121. (p. 655) In what type of ownership is each individual considered to own a proportionate
share for tax purposes with only your share being included in your estate?
Chapter 19 – Estate Planning
122. (p. 649) Gary Ruhle has assets worth $2,400,000. Since he plans to travel and does not want
to oversee these assets, he has created a legal arrangement so tee assets can be managed by an
officer of his local bank. What type of legal arrangement has he most likely made?
123. (p. 649) Which of the following would be a benefit of establishing a trust?
124. (p. 649) Sally Forth has a trust that she can end at any time she wants. What type of trust
does Sally have?
Chapter 19 – Estate Planning
125. (p. 657) A federal tax levied on the right of a deceased person to transmit his or her
property and life insurance at death is called a(n) ____________ tax.
126. (p. 658) A state tax levied on the right of an heir to receive all or part of the estate and life
insurance proceeds of a deceased person is called a(n) ____________ tax.
127. (p. 658) A federal and state tax levied on the privilege of making gifts to others is called
a(n) ____________ tax.
Chapter 19 – Estate Planning
128. (p. 658) As of 2010, what is the maximum yearly amount that an individual can give as a
gift without incurring gift tax liability or having to report the gift to the IRS?
129. (p. 660) How many months after your death is the federal estate tax due and payable in
cash?
Chapter 19 – Estate Planning
130. (p. 660) Gerald Wilkins owns a home worth $250,000, a car worth $15,000, various
investments worth $600,000 and other personal assets worth $25,000. He still owes $125,000
on his mortgage and $5,000 on a car loan. The probate and administration costs of his estate
are estimated at $5,000. What is his estimated net taxable estate?
131. (p. 646) Advance directives are legal documents that allow you to state what kind of health
care you want if you were too ill to speak for yourself. Advance directives most often include
which of the following?
Chapter 19 – Estate Planning
132. (p. 648) George Smith worries that his deteriorating health is going to make it difficult for
him to conduct his day-to-day business. He wants to grant his nephew, Brandon Smith, the
ability to act on his behalf. To do this, what document would he most likely need?
133. (p. 648) Maryanne Strothman wants to leave some words of encouragement and spiritual
advice to her children to encourage their faith in the event that something happens to her.
What type of document would be best for her to prepare?
134. (p. 643) Which of the following is not a true statement about a holographic will?
Chapter 19 – Estate Planning
135. (p. 644) Which of the following would keep you from being an executor of a will?
136. (p. 644) Which of the following would keep you from being an executor of a will?
137. (p. 635) What is estate planning and how does your personal situation affect that planning?
Chapter 19 – Estate Planning
138. (p. 639 – 641) Explain what a will is and what occurs at your death if you do not have one.
Chapter 19 – Estate Planning
139. (p. 642-656) How do wills and trusts help in planning your estate?
140. (p. 656-659) What are the federal and state tax considerations in estate planning?
Chapter 19 – Estate Planning
141. (p. 649) What are some common reasons for setting up a trust?