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Which of the following type of trust does not require a “payback” to the State of Ohio at the death of the Special Needs Trust Beneficiary?
1. Supplemental Services Trust
2. Special Needs Trust
3. Third Party Discretionary Trust

Use the following scenario to answer questions 2 through 4.

Karen, age 58, recently visited her attorney to discuss appropriate strategies to reduce her taxable estate and/or provide liquidity to pay taxes. Given the following goals, which document is appropriate to effectuate the goal? Each document may be used more than once.

Charitable Remainder Trust
Charitable Lead Trust
Irrevocable Life Insurance Trust

Question	Answer	Goal
2.		Karen wants to remove an asset from her estate but receive cash payments during her lifetime
3.		Karen wants to remove an asset from her estate and have her descendants receive it later
4.		Karen wants to provide liquidity to pay taxes at her death

True or False: Effective Spousal Lifetime Access Trusts can be nearly identical and signed on the same day by both spouses for convenience.

Donald has created an irrevocable trust in 2022 for the benefit of his three nephews, Huey, Dewey, and Louie, who are all minors. Donald plans on making annual contributions to the trust. Donald would like at least some of his annual contributions to the trust to qualify for the annual exclusion. What would be the best way to accomplish this goal?
1. Donald should make sure that he does not contribute more than $17,000 for each nephew, or $51,000 in total, each year.
2. Donald should give his nephews an unlimited ability to remove funds from the trust.
3. Donald should give his nephews the right to remove some or all of the annual contribution from the trust for a limited period of time.
4. Donald’s annual contributions to the trust will not qualify for the annual exclusion under any circumstances.

Roberta wants to give money to charity and receive an income tax deduction. From the perspective of receiving an income tax deduction only, which of the following would you recommend she choose to receive her gift?
1. The NRA
2. AARP
3. The ACLU
4. The Salvation Army

This year, Dottie donated $10,000 in cash to her church, and she also donated medical supplies with a fair market value and adjusted basis of $20,000 to the Red Cross. Dottie’s AGI for this year is $50,000. What is Dottie’s charitable income tax contribution deduction for the year?
1. $10,000
2. $20,000
3. $25,000
4. $30,000

Thomas is seeking to obtain long term Medicaid for nursing home. His current assets are worth

$1500. Thomas is unmarried. When Thomas meets with a financial advisor, the advisor tells him that because he gave $100,000 to his nephew last year Thomas will be unable to apply and receive Medicaid for five years.

1. The advisor is correct.
2. The advisor is wrong.

Donna’s mother dies. Donna’s mother owned: (1) a brokerage account valued at $200,000 owned as a tenancy-in-common with Donna. (2) a $1 million life insurance policy owned on Donna which has a replacement value of $300,000. (3) a life estate in a piece of real estate which is valued at $700,000. What is the value of mother’s gross estate?
1. $100,000
2. $200,000
3. $400,000
4. $1,900,000

Under the three (3) year date of death rule, which of the following transfers of property made within three (3) years of the decedent’s death will be included in the decedent’s gross estate.

All gifts made within three (3) years of death.
All annual exclusion gifts made within three (3) years of death.
All sales of real estate made within three (3) years of death.
1. I only
2. I and II
3. I and III
4. I, II, and III
5. None of the transfers are subject to inclusion.

True or False: In order for a gift to an organization to not be included in calculating total lifetime gifts, the organization must be a 501c(3).

Assume that the gift tax exemption decreases from $12.92 million to $6.5 million on January 1, 2026.

True or False: If a person gifts $8 million dollars to her niece in 2025 and then dies in 2026, there will be estate tax owed on $1.5 million.

Which statement or statements is/are true for 2023? (More than one answer may apply.)
1. A $17,000 gift to another person in 2023 will not be included in calculating the total lifetime gifts made by the donor.
2. A recipient may receive a total $17,000 on an annual basis from all donors.
3. The annual exclusion is in addition to the lifetime gift tax exclusion amount.
Which of the following statements is/are true concerning “split gifts”? (More than one answer may apply.)
1. Allows the utilization of twice the annual exclusion only by spouses if an election is made.
2. Allows the utilization of twice the annual exclusion by spouses requiring no election.
3. Allows the utilization of twice the annual exclusion by unrelated parties if an election is made.
4. Allows the utilization of twice the annual exclusion by related parties as long as an election is made.

Which of the following is true with respect to the valuation of a gift?

No valuation discounts are allowed.
An alternate valuation date may be used.
The value is based is the FMV of the asset on the date the donor decides to make the gift.
1. I and III
2. II and III
3. III only
4. All of the above
5. None of the above

Use the following scenario to answer questions 17 and 18.

John and Miguel own several rental properties together in a single LLC. Assume John is sued by Alice after John hits her with his car while he is taking his children to a soccer game on the weekend. Alice is awarded $100,000.

True or False: Miguel may have to become partners with Alice.

True or False: Alice can force John and Miguel to sell one of the properties to pay her $100,000.

Sally and Rowina own several rental properties in an LLC.

True or False: If a tenant is injured at one of the properties and obtains a judgment against the LLC for 1,000,000.00, all the properties of the LLC may have to be sold in order to satisfy the judgment.

Serena comes to you to talk about her parents. She is concerned that if her father goes into a nursing home through Medicaid, her mother who is healthy will be forced out of her home during her lifetime even if she can live alone.
Which of the following statements concerning the ownership of real property as joint tenants with right of survivorship is (are) correct?

If the joint tenants are mother and son and the son contributed all the funds to purchase the property, one-half of the property’s value will be excluded from the mother’s estate if she dies first.
If the joint tenants are married to each other and the wife contributed all the funds to purchase the property, the entire value of the property will be in the wife’s estate if she dies first.

1. I only
2. II only
3. Both I and II
4. Neither I nor II

Use the following scenario to answer questions 23 through 25.

Your client comes to you and asks for advice to give money to his grandchildren that will qualify for the annual gift exclusion.

If control of the funds until each grandchild is 23 is most important for your client, which of these would you recommend?
1. A trust with Crummy provisions
2. A Uniform Transfers to Minors Act account
3. A 529 Education Savings Account

If your client wishes for the strategy to allow for the ownership of real estate, which would you recommend?
1. A trust with Crummy provisions
2. A Uniform Transfers to Minors Act account
3. A 529 Education Savings Account

If your client wants the assets to be able to be spent on only education related expenses, which would you recommend?
1. A trust with Crummy provisions
2. A Uniform Transfers to Minors Act account
3. A 529 Education Savings Account

Client creates an inter vivos revocable trust of which the client is the Grantor, Trustee, and the lifetime beneficiary. Which of the following estate planning objectives of the client can be satisfied?

Avoid probate.
Remove assets from the estate.
Provide a unified method of managing and distributing assets during lifetime and after death.
Protect assets from the Grantor’s creditors.
1. I and IV
2. II and IV
3. II and III
4. I and III
5. None of the above.

True or False: A STABLE account is more like a Third Party Trust than it is like a special needs trust.

True or False: When discussing estate taxes, a financial advisor should talk about the estate tax credit amounts rather than the estate tax exemption amount because the estate tax credit is easier to understand and explain.

A client dies with a will instructing that all assets pass to the surviving spouse. Which of the following assets will pass to the surviving spouse under the provisions of the will?
1. Decedent’s $500,000 IRA with the wife named as the beneficiary.
2. Decedent’s $1 million life insurance policy with the decedent’s “Estate” named as the beneficiary.
3. The $750,000 home decedent owned as a tenancy-by-the-entirety with his wife.
4. None of these assets will pass under the provisions of the will.
5. All of these assets will pass under the provisions of the will.

Nate owns the following property:

A personal residence titled fee simple valued at $500,000.
A $500,000 life insurance policy on his own life. The only named beneficiary is Nate’s brother Jaime, who died 6 months ago leaving two children, Michael and Kristi.
A car valued at $15,000 titled JTRWROS with Nate’s mother.
An IRA valued at $400,000 with Nate’s mother as the named beneficiary.

What is the value of Nate’s probate estate?

$500,000
$1,000,000
$1,400,000
$1,415,000

Which of the following is/are always true about wills?

A will transfers all of the decedent’s assets.
A will only takes effect when the decedent dies.
A will names an Administrator for the estate.
Use of a Will to distribute assets at death guarantees probate court

1. I and II only
2. II and III only
3. II and IV only
4. I, II and III only

Andrea is applying for Medicaid Nursing Home care. She is concerned that her husband will not have enough income if she goes into the nursing home because she was the primary breadwinner and was told that all her income from her retirement and Social Security retirement will go to the nursing home.

1. Andrea has been given bad advice because some of Andrea’s income can go to her husband up to the limit set by the State of Ohio.
2. Andrea has been given good advice because all of her income must go to the Nursing home.
Why is a Crummy provision used?

1. To ensure a beneficiary remains eligible for Medicaid.
2. To ensure that a gift to a trust qualifies for the annual gift exclusion.
3. To ensure that a beneficiary can’t access the assets in a trust.

Joe and Marie have a child with a disability, Susan, and two other children, Amy and Fredrick, who have no special needs. Susan is currently receiving Medicaid benefits. Joseph and Maria are creating an Irrevocable Life Insurance Trust for the benefit of their children. Their ILIT trustee will purchase a “Survivor Life” policy that will be payable to a Third Party Discretionary Trust for Susan at their deaths, and also to general needs trusts for their two other children. Which of the following statements concerning this strategy is correct?
1. If Susan’s share of the life insurance proceeds is payable to the Third Party Discretionary Trust for her benefit, she will still qualify for Medicaid because a Third Party Discretionary Trust is not a countable resource.
2. If Susan’s share of the life insurance proceeds is payable to a Third Party Discretionary Trust for her benefit, she will not qualify for Medicaid because the Third Party Discretionary Trust is a countable resource.
3. If Fred and Amy are the only beneficiaries, Susan will still be disqualified from Medicaid because the government will know that the Kings are trying to “get around” the system.
4. None of the above statements are correct.

Ken and Jennifer Mac have donated appreciated real estate valued at $1,000,000 to a charitable remainder trust. Which of the following tax benefits are available to them as a result of their gift?
1. Ken and Jennifer receive an income tax deduction against current income equal to the value of the gift minus the present value of their income interest.
2. Ken and Jennifer pay no capital gains tax when the real estate is sold by the trustee of the charitable remainder trust.
3. Ken and Jennifer pay no estate tax on the remainder interest which passes to charity at their deaths.
4. All of the above are tax benefits available.

Which of the following is not a valid business purpose to support the formation of a Family Limited partnership?
1. To protect assets from creditors.
2. To manage family wealth and share family assets with family members
3. To organize the family’s main hobby so all members can participate fairly
4. To implement estate planning goals and objectives.
Bob and Sally Jones form a Family Limited Partnership and transfer their farm to the partnership in exchange for a 1 percent general partner interest and 99 percent limited partner interests. Bob and Sally retain the one percent general partner interest and gift the limited partner interests to their three children. Which of the following is a true statement about the Family Limited Partnership?
1. Bob and Sally cannot decide to sell the farm without the consent of at least a majority of the limited partners.
2. If the farm business distributes $100,000 to the partners proportionately, Bob and Sally will only receive $1,000 and their children will receive $99,000.
3. If the farm had a fair market value of $1,000,000 at the time Bob and Sally made their gifts to their children a judgment creditor could probably seize the farm before the gifts are made
4. Bob and Sally cannot gift their general partner interest to their children.

A life insurance trust is often named the beneficiary of a life insurance policy it holds for which of the following reasons?
1. It can provide greater flexibility than is available under insurance settlement options
2. It can eliminate a second estate tax upon the death of the beneficiaries.
3. It can incorporate special limitations and restrictions on the funds designed to be paid to specific beneficiaries.
4. All of the above

Which of the following is not a characteristic of a Special Needs Trust?
1. The trust is still a “countable resource” for Medicaid eligibility.
2. The trust is not a “countable resource” for Medicaid eligibility.
3. At the death of the special needs beneficiary, the State is entitled to reimbursement, dollar-for-dollar of any Medicaid benefits paid on behalf of the trust beneficiary during his or her life.

True or False: The cost of probate estate administration is not a concern for most beneficiaries because the estate of the deceased pays the cost.

Which of the following qualifies for the unlimited marital deduction?
1. Outright bequest to resident noncitizen spouse.
2. Property passing to noncitizen spouse in QTIP.
3. Outright bequest to resident spouse.
4. Income beneficiary of a CRUT who is a nonresident alien spouse.

Which of the following statements concerning joint tenancy with right of survivorship is correct?
1. This form of ownership is available only to two related parties.
2. Ownership interests must be equal.
3. During his or her lifetime, each joint tenant may sell his or her interest only to another joint tenant.
4. A joint tenant may leave his or her interest by will to someone other than another joint tenant.
In which of the following situations has a transfer not been completed for gift tax purposes?
1. Bill gives his nephew $100 as a birthday gift.
2. Jane’s grandmother, dying of cancer, gives Jane a valuable family heirloom and indicates that she wants Jane to have it.
3. Stella loans her niece a loan of 15,000.00 but does not charge interest.
4. John and his son establish a joint bank account and John deposits $100 into the account.

Fred, the founder and CEO of WonderCo, recently passed away. At his death, Fred owned 80% of the stock of WonderCo; and the WonderCo stock was his only asset. WonderCo is a publicly traded company. Which of the following discounts would be applicable to Fred’s WonderCo stock?
1. Key Person Discount
2. Minority Ownership Discount
3. Both a and b
4. Neither a nor b

Which of the following types of property is subject to probate?
1. death benefits from a retirement plan passing to a named beneficiary
2. testamentary trust property
3. life insurance proceeds paid to a named beneficiary
4. property held jointly with right of survivorship passing to the surviving joint tenant

Which of the following statements concerning the use of Crummey powers with an irrevocable life insurance trust is correct?
1. Crummey powers are used to make an irrevocable life insurance trust a future- interest gift.
2. The right to exercise the Crummey powers must exist for a reasonable period of time each year.
3. If there are several beneficiaries, Crummey powers should be given to only one beneficiary.
4. A danger is that the beneficiary can request an amount greater than the grantor’s annual addition to the corpus and thus the insurance policy can be stripped by the beneficiary.

Which of the following statements concerning the federal estate tax is correct?
1. Property included in the gross estate for federal estate tax purposes must be valued at its fair market value on the date of death.
2. Beneficiaries of an estate cannot be charged with estate tax liability.
3. The estate subject to tax includes not only property actually owned by the estate owner at the time of death but also property deemed to have been owned at the date of death.
4. U.S. citizens are subject to federal estate tax only on property they own at the time of death that is located in the U.S.
A client’s grandmother wishes to give your client appreciated Walmart stock that her grandmother earned while working there. Grandmother received the stock when it was valued at $5.00/share. It is now worth $100/share. Which is true regarding taxes?
1. Your client will have to pay taxes on the gift if it is more than $17,000.
2. Your client accepts the gift and does not worry about taxes because your client’s basis in the property will go up when grandmother dies whether she accepts the gifts
3. Your client is concerned about accepting the gift now because her basis will be $5.00/share.

James and Donna Smith own an insurance brokerage business that they incorporated fifteen years ago with an initial investment of $500.00. Their common stock is now worth $1,000,000, and they are considering selling the business. James and Donna have contacted you to discuss their options. They would like to sell the business and diversify their investment into various stocks, bonds, and mutual funds. However, they are nervous about the large capital gains tax they would have to pay. In order to avoid paying capital gains tax on the sale of their stock, which of the following transactions would you recommend?
1. Gift the stock to a Special Needs Trust and receive income for life.
2. Gift the stock to a Charitable Lead Trust and reserve a life payout for themselves.
3. Gift the stock to a Charitable Remainder Trust and reserve a life payout for themselves.
4. Gift the stock to an Irrevocable Life Insurance Trust and use the proceeds from sale to purchase life insurance on their lives.
David would like to fund a charitable trust and name himself as the income beneficiary. He would like the payout from the trust each year to be constant. Given David’s desires, which type of charitable trust should David fund?
1. Charitable Lead Annuity Trust
2. Charitable Lead Unitrust
3. Charitable Remainder Annuity Trust
4. Charitable Remainder Unitrust

In which of the following situations would the entire property transferred at death receive a fully stepped-up basis?
1. income that is included in the decedent’s gross estate as income in respect of a decedent
2. appreciated property acquired by the decedent by gift within one year before death that is left to donor’s spouse
3. property held in joint tenancies between spouses that is received by the surviving spouse upon the death of the first spouse
4. property that passes to another because the decedent owned a fee simple interest in the property.