1. Which of the following statements concerning executors is correct?
a) An executor can be given broad and discretionary powers with respect to the management of estate assets.
b) An executor is chosen by the beneficiary of a will shortly after the decedent’s death.
c) An executor must be an individual rather than an entity or institution
d) An executor is answerable only to the beneficiary and not to the court having jurisdiction over the probate of the estate.
2. Charles Kuralt purchased a joint life annuity for himself and his paramour from an insurance company. Assuming Charles contributed the entire purchase price, how will the annuity be valued at his death for purposes of determining his gross estate?
a) at the original cost of the joint life annuity
b) at the cost of a single life annuity on Charles’s life at the date of his death
c) at the cost of a single life annuity for his paramour at the time the original annuity was purchased
d) at the cost of a single life annuity for his paramour at the time of his death
3. Which of the following powers would result in the property subject to the power being included in a decedent’s estate?
a) the power to add to the corpus
b) the power to change beneficiaries
c) the power to direct issuance of voting proxies
d) the power to direct the reinvestment of funds
4. Which of the following is a gift for federal gift tax purposes?
a) Without compensation a carpenter builds a chicken shed for a neighbor
b) A valuable oil painting owned by a father is delivered to his son to be displayed at the son’s residence with a provision that the painting is to be returned to the father on demand.
c) A father tells his son that he need not pay interest on a $50,000 interest-bearing note evidencing a loan that the father made to his son.
d) A mother promises to give her son her new car as soon as the odometer reads 50,000 miles.