Question 1

A durable power of attorney authorizes one person to handle the estate of another upon the death of the latter.​

Accepted Answer

A durable power of attorney allows one person to handle the affairs of another while they are alive, but it does not extend beyond the death of the individual. Upon death, the authority of the durable power of attorney ends, and the estate is then managed according to the will or state law.

Question 2

Assisted suicide includes the acts of aiding and abetting another to commit suicide.​

Accepted Answer

Assisted suicide involves providing a person with the means or information to commit suicide, including aiding or abetting them in taking their own life.

Question 3

Joint tenancy is a form of joint property ownership allowing parties to avoid all taxes on such owned property.

Accepted Answer

Joint tenancy allows for the right of survivorship, meaning when one owner dies, the property passes to the surviving owner(s) without going through probate. However, it does not allow parties to avoid all taxes, such as property taxes or potential capital gains taxes upon sale.

Question 4

Statutory wills were devised to provide for complex and unusual circumstances of persons who may otherwise die intestate.

Accepted Answer

The answer of Statutory wills were devised to provide for...

Question 5

The person who creates a testamentary trust may not serve as the trustee of the trust.​

Accepted Answer

A testamentary trust is created by a will, and the person who creates the will (the testator) cannot also serve as the trustee of the trust. This is because the trustee is responsible for managing the trust assets and carrying out the testator's wishes, and the testator cannot be both the creator and the manager of the trust.

Question 6

Very few adults are able to qualify to act as an executor.​

Accepted Answer

Many adults can qualify to act as an executor as long as they are of legal age, mentally competent, and not a convicted felon in many jurisdictions.

Question 7

In 1900, there was no federal income tax or federal estate and gift tax.​

Accepted Answer

In 1900, the United States did not have a federal income tax or federal estate and gift tax. The federal income tax was introduced with the 16th Amendment in 1913, and the federal estate tax was introduced in 1916.

Question 8

An inter-vivos trust may be made revocable, or revocable after a specified time, or irrevocable - each with different objectives and potentially different tax consequences.

Accepted Answer

An inter-vivos trust, also known as a living trust, can indeed be structured as revocable, allowing the grantor to alter or terminate the trust during their lifetime, or irrevocable, where the trust cannot be changed after its creation. The choice between revocable and irrevocable impacts the trust's objectives, such as asset protection and estate planning, and can have different tax implications for the grantor and beneficiaries.

Question 9

One element of an estate plan is to consider whether life insurance is appropriate for the needs of beneficiaries. ​

Accepted Answer

Life insurance is a common component of an estate plan, as it can provide financial support to beneficiaries, cover estate taxes, and help ensure that the estate's financial goals are met.

Question 10

State laws, which regulate how property shall be distributed when a resident of the state dies without leaving a will, are called trust laws.​

Accepted Answer

These laws are called intestacy laws, not trust laws. Trust laws govern how trusts are managed, while intestacy laws dictate the distribution of a deceased person's estate when they die without a will.

Question 11

The person who creates an inter-vivo trust may not serve as the trustee of the trust.

Accepted Answer

The person who creates an inter vivos trust (a trust created during their lifetime) can serve as the trustee of the trust, managing the assets according to the terms of the trust.

Question 12

A spendthrift trust is one that gives directions to the trustee to spend all money on the beneficiary as fast as possible.​

Accepted Answer

A spendthrift trust is designed to protect the beneficiary's assets from their own potential reckless spending and from creditors, by giving the trustee control over how the funds are distributed to the beneficiary.

Question 13

A fidelity bond insures against losses caused by the dishonest performance of duties by a personal representative. ​

Accepted Answer

A fidelity bond is a form of insurance protection that covers policyholders for losses that they incur as a result of fraudulent acts by specified individuals. It often insures a business for losses caused by the dishonest acts of its employees, including the dishonest performance of duties by a personal representative or fiduciary.

Question 14

Estate plans ideally should be customized to fit the unique circumstances and situation of the individual or family for whom the plan is prepared. ​

Accepted Answer

Estate plans need to be tailored to the individual's or family's specific needs, assets, and goals to ensure that their estate is managed and distributed according to their wishes.

Question 15

A serious objection to making a last will is its finality and irrevocability. ​

Accepted Answer

A last will can be changed or revoked by the person who made it at any time before their death, as long as they are mentally competent.

Question 16

Trustees normally collect money for their services through brokerage fees earned from investment in securities for the trust.​

Accepted Answer

Trustees typically collect money for their services through direct fees or commissions charged to the trust, not through brokerage fees earned from investments.

Question 17

Estate planning is an ongoing analysis of what a person owns or expects to own (assets), and what he or she owes to others (liabilities). ​

Accepted Answer

Estate planning involves continuously analyzing and managing one's assets and liabilities to ensure their estate is handled according to their wishes upon death or incapacitation.

Question 18

Estate planning has substantial potential monetary and psychological value for an elderly retired person, but not for a young bachelor or young married couple. ​

Accepted Answer

Estate planning is important for individuals at any stage of life, including young bachelors or young married couples, as it helps in managing assets, designating beneficiaries, and ensuring financial security for loved ones in case of unexpected events.

Question 19

A holographic, un-witnessed will is often as legally effective as a formal, witnessed will.

Accepted Answer

A holographic will, which is handwritten and not witnessed, can be legally effective in many jurisdictions if it meets certain requirements, such as being entirely in the testator's handwriting and clearly expressing the testator's intent to make a testamentary disposition of their property. However, the specific legal effectiveness and requirements can vary significantly by jurisdiction.

Question 20

A trust may be used to protect a spendthrift child against his or her own folly and against possible exploitation by others.​

Accepted Answer

A trust can be specifically designed with spendthrift provisions to control the distribution of assets, thereby protecting the beneficiary from their own poor financial decisions and from creditors or others who might seek to exploit them.

Quiz 15: Wills, Trusts, and Probate

A durable power of attorney authorizes one person to handle the estate of another upon the death of the latter.​

Assisted suicide includes the acts of aiding and abetting another to commit suicide.​

Joint tenancy is a form of joint property ownership allowing parties to avoid all taxes on such owned property.

Statutory wills were devised to provide for complex and unusual circumstances of persons who may otherwise die intestate.

The person who creates a testamentary trust may not serve as the trustee of the trust.​

Very few adults are able to qualify to act as an executor.​

In 1900, there was no federal income tax or federal estate and gift tax.​

An inter-vivos trust may be made revocable, or revocable after a specified time, or irrevocable - each with different objectives and potentially different tax consequences.

One element of an estate plan is to consider whether life insurance is appropriate for the needs of beneficiaries. ​

State laws, which regulate how property shall be distributed when a resident of the state dies without leaving a will, are called trust laws.​

The person who creates an inter-vivo trust may not serve as the trustee of the trust.

A spendthrift trust is one that gives directions to the trustee to spend all money on the beneficiary as fast as possible.​

A fidelity bond insures against losses caused by the dishonest performance of duties by a personal representative. ​

Estate plans ideally should be customized to fit the unique circumstances and situation of the individual or family for whom the plan is prepared. ​

A serious objection to making a last will is its finality and irrevocability. ​

Trustees normally collect money for their services through brokerage fees earned from investment in securities for the trust.​

Estate planning is an ongoing analysis of what a person owns or expects to own (assets), and what he or she owes to others (liabilities). ​

Estate planning has substantial potential monetary and psychological value for an elderly retired person, but not for a young bachelor or young married couple. ​

A holographic, un-witnessed will is often as legally effective as a formal, witnessed will.

A trust may be used to protect a spendthrift child against his or her own folly and against possible exploitation by others.​

A durable power of attorney authorizes one person to handle the estate of another upon the death of the latter.

Assisted suicide includes the acts of aiding and abetting another to commit suicide.

The person who creates a testamentary trust may not serve as the trustee of the trust.

Very few adults are able to qualify to act as an executor.

In 1900, there was no federal income tax or federal estate and gift tax.

One element of an estate plan is to consider whether life insurance is appropriate for the needs of beneficiaries.

State laws, which regulate how property shall be distributed when a resident of the state dies without leaving a will, are called trust laws.

A spendthrift trust is one that gives directions to the trustee to spend all money on the beneficiary as fast as possible.

A fidelity bond insures against losses caused by the dishonest performance of duties by a personal representative.

Estate plans ideally should be customized to fit the unique circumstances and situation of the individual or family for whom the plan is prepared.

A serious objection to making a last will is its finality and irrevocability.

Trustees normally collect money for their services through brokerage fees earned from investment in securities for the trust.

Estate planning is an ongoing analysis of what a person owns or expects to own (assets), and what he or she owes to others (liabilities).

Estate planning has substantial potential monetary and psychological value for an elderly retired person, but not for a young bachelor or young married couple.

A trust may be used to protect a spendthrift child against his or her own folly and against possible exploitation by others.