1. A

Since Scott died within three years of the ownership transfer, the life insurance proceeds will still be included in his gross estate. Life insurance proceeds are tax-free if paid directly to the beneficiary. No gift or generation-skipping transfer tax will be due.

2. C

Shane can pass an unlimited amount of assets to his spouse with no gift tax, generation-skipping transfer tax, income tax or capital gain consequences.

3. D

If Roger gifts more than $14,000 directly to any individual in 2013, he will expose himself to the gift tax. Payment of medical expenses for anyone in any amount directly to the medical facility is not taxed under the gift or estate tax.

4. D

If Debby pays the tuition of the grandson directly to the college the amount is unlimited, but a direct gift to her grandson for college expenses cannot exceed $14,000 in 2013 to avoid gift taxes.

5. B

Assets do not qualify for the marital deduction. They are taxed in the estate of the first spouse to die.
 



Introduction

Related Articles
  1. Retirement

    Estate Planning Law Changes You Need To Know

    When organizing your affairs, you'll need to be aware of tax rates and other regulations.
  2. Taxes

    What The New Gift Tax Rules Will Mean

    The lifetime maximum for gift taxes is $5.12 million. However, it could drop to $1 million. Here's what that will mean.
  3. Insights

    Gift-Giving Etiquette

    Here's a look at how much you should spend and what you should give this holiday season.
  4. Taxes

    10 Sources of Nontaxable Income

    Taxes are often a deterrent from investing and saving. These financial practices will bring you no tax grief.
  5. Taxes

    Valuable Year-End Tax Moves for 2016 (Part Three)

    Here's a look at tax strategies for itemized deductions, charitable gifts and other tax credits.
  6. Financial Advisor

    A Quick Guide to High-Net-Worth Estate Planning

    A quick estate planning guide for high-net-worth individuals to help minimize taxes and costs, protect assets and plan for care.
  7. Insurance

    How To Avoid Taxation On Life Insurance Proceeds

    Decrease the value of your taxable estate and prevent the tax man from getting you one last time.
  8. Personal Finance

    How to Talk to Your Family About Christmas Gift Budgets

    Talking Christmas gift budgets with family members can be hard, but having the talk will help you stay on track financially.
  9. Personal Finance

    How To Get Gift Cards At A Discount

    Use these tips whether you're buying someone a gift or just want to score a discount at your favorite stores.
Frequently Asked Questions
  1. What are the Differences Among a Real Estate Agent, a broker and a Realtor?

    Learn how agents, realtors, and brokers are often considered the same, but in reality, these real estate positions have different ...
  2. What is the difference between amortization and depreciation?

    Because very few assets last forever, one of the main principles of accrual accounting requires that an asset's cost be proportionally ...
  3. Which is better, a fixed or variable rate loan?

    A variable interest rate loan is a loan in which the interest rate charged on the outstanding balance varies as market interest ...
  4. What is the 1003 mortgage application form?

    Learn about the 1003 mortgage application form, what information it requires and why this form is the industry standard for ...
Trading Center