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estate tax.doc

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True or false 1. succession takes place upon the death of the decedent 2. unpaid funeral expenses are nevertheless deductible from gross estate as part of “claims against the estate” 3. estate tax is property tax 4. decedent’s interest includes revocable inter vivos transfers of properties until the death of the donor 5. the share of the surviving spouse in the community property is not included in the gross estate of the decedent spouse. 6. the proceeds of life insurance policies payable upon d
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   True or false1. succession takes place upon the death of the decedent2. unpaid funeral expenses are nevertheless deductible from gross estate as part of “claims against the estate”3. estate tax is property tax4. decedents interest includes revocable inter vivos transfers of properties until the death of the donor!. the share of the surviving spouse in the community property is not included in the gross estateof the decedent spouse. . the proceeds of life insurance policies payable upon death of the decedent are exempt from the payment of estate tax.#. if the decedent sells properties because of an impending death$ the di%erence bet&een the market values at the time of sale and at the time of death$ if any$ is sub'ect to estate tax.(. if there is reciprocity$ the intangible personal property in the )hilippines of the non resident alien is sub'ect to estate tax in the )hilippines*. a po&er of appointment is general if the donee is authori+ed to appoint a bene,ciary named inthe &ill of the prior decedent.1-. a husband cannot donate his share in the community property to his surviving spouse.11. &innings in gambling is con'ugal property. o&ever$ losses thereon shall be borne exclusivelyby the loser/spouse.12. donations to charitable institutions are deductions from gross estate13. death bene,t from the 0 is exempt from estate tax14. the cost of the mourning apparel of a spinster daughter of the deceased is deductible as funeral expense1!. unpaid accountants fees to an accountant &ho signed the ) certi,cate is deductible as “claims against the estate”1 . an unpaid loan contracted by the decedent spouse &hich is secured by a mortgage of a community property is deductible as a claim against the estate and not as unpaid mortgage1#. in an accommodation loan$ there is an addition to and a deduction from gross estate$ thus resulting to a +ero balance in the net estate.1(. casualty losses are deductible from gross estate and from gross income1*. the family home of a non resident citi+en is includible in the gross estate but not deductible therefrom2-. the estate of a nonresident alien is not entitled to a vanishing deduction.21. net taxable estate is another term for net distributable estate22. only the estate of resident citi+en can claim tax credit on estate taxes paid to foreign countries23. notice of death should be made &ithin 3- days after the death of the decedent24. ,ling of the estate tax return is re5uired if the transfer is sub'ect to estate tax regardless of the value of the gross estate.2!. installment payment of estate tax maybe allo&ed if there are no available cash of the estate.ns&ers to True or false1True26alse6uneral expenses$ &hether paid or unpaid$ are deductible as funeral expense36alset is an excise tax4True!6alse The entire community properties of the spouses are included in the gross estate 6alse)roceeds of life insurance shall be exempt only from estate tax if the designated bene,ciary in the policy is irrevocable and is not the estate$ executor or administrator#6alse The sale must be for an insu7cient consideration(6alsef there is reciprocity$ the intangible personal property &ithin is not taxable in the )hilippines*6alsen that case$ the po&er of appointment is special16alsThe prohibition is applicable on inter vivos donations only. Thus$ it is allo&ed if the  -edonation is to become e%ective upon the death of the donor/spouse11 True126alse They are exclusions from gross estate but not deductions13 Truell bene,ts from  and 0 are exempt from 89:; and ;TT; tax146alse The daughter must be minor and unmarried1!6alset is deductible as 'udicial expense1 6alset is deductible as an unpaid mortgage rather than as claims against the estate1# True The amount of money borro&ed is deductible as claims against the estate< ho&ever$ that same amount &hich &as loaned to accommodate the ,nancial needs of another person should be included in the gross estate as a receivable of the estate on the debtor.1(6alset is deductible from either gross income or gross estate but not on both1* True To be deductible$ family home must be situated in the )hilippines2-6alse=anishing deduction can be claimed provided that the sub'ect property is situated in the )hilippines216alse8et taxable estate is the basis in computing the estate tax$ &hile net distributable estate pertains to the amount that &ill be distributed among the heirs.226alse9ther than he resident citi+ens$ the estate of non resident citi+ens and resident aliens can also claim tax credit on estate taxes paid abroad236alse8otice of death must be made &ithin 2 months after the decedents death$ or &ithin a like period after 5ualifying as executor or administrator24 True6iling of estate tax return is re5uired if the gross value of the estate exceeds 2--$--- and regardless of value &here the said real estate consists of registered or registrable property2! Truef the tax is paid by installment$ a clearance shall be released only &ith respect to the property the corresponding tax on &hich has been paid.1. >hich of the follo&ing is not an element of succession? a. @ecedent c. eir b. ;state d. dministrator2.nheritance does not includea. propertyb. public o7ce c. rights not extinguished by deathd. obligations not extinguished by death3.;state tax isa. a property tax because it is imposed o the property transmitted by the decedent to his heirs.b. an indirect tax because the burden of paying the tax is shifted on the executor or any of the heirs of the decedent.c. an excise tax because it is imposed on the privilege exercised by the decedent to transfer o&nership over the estate.d. a poll tax because it is also imposed on residents of the )hilippines &hether 6ilipino citi+ens or not.4.>hich of the follo&ing is not a distinction bet&een estate tax and donors tax? a.  The tax imposed is an excise tax. b. ;xtension for payment. c. ;%ectivity of the transfer of property. d. The exemption granted in the tax table.!.tatement 1A The estate tax accrues at the moment of death of the decedent.tatement 2A n estate taxation$ the taxpayer is the decedent.>hich of the above statement is correct?a.tatement 1 only. c. Both statementsb.tatement 2 only. d. 8either statements . n 2--2$ C. ru+ gave a loan of )1!-$--- to sexy$ his secretary. n 2--!$ as an act of generosity$ C.ru+ condoned the debt of exy in his last &ill and testament. C. ru+ died in 2--(. The condonation of the debt of exy is   a.  donation inter vivos sub'ect to donors tax. b.  payment or compensation for the services rendered. c.  deduction from the gross estate of C.ru+. d.  donation mortis causa sub'ect to estate tax.#. The follo&ing are the motives of a taxpayer that preclude the transfer in contemplation of death$ except one a. To relieve the taxpayer of the burden of management. b. To save income and property taxes. c.  To avoid payment of estate taxes. d. To make dependents ,nancially independent.(. n default of testamentary heirs$ the la& determines &ho are to succeed to the inheritance of the deceased. >hich of the follo&ing ranks ,rst in the order of succession? a. legitimate children c. legitimate parents b. surviving spouse d. illegitimate children*.  and > are married. They have legitimate children  and B.  died$ survived by >$  and B. e estate of )12$---$--- should be divided as follo&sA >  B 6ree portiona. ) 3 : ) 4.!: ) 4.!: 8one b. 3: 3:3: ) 3:c. 8one : : 8oned2.2!: 4.!: 4.!: 2.2!: 1-. Based on the follo&ing data$ ho& mush is the value of the decedents interest if he died :arch 31$2--(? ash in bank$ 'oint account of the decedent nd his &ife ) 2!4$--- nterest on the bank deposit D Canuary 1/ Cune 3-$2--(E *$--- @ividends from a domestic corporationA -$--- @ate of declaration/ 6ebruary !$ 2--( @ate of record / pril 1!$2--( @ate of payment / :ay 1!$2--( hare in 2--# net pro,t of partnership$ @istributed to partners on pril 1! *$--- >innings in lotto D Bet$ :arch 3-< pril 1$ 2--( @ra&E !--$---a.) 3(3$#!- c. )14!$---b.13($--- d. 3(($2!-11. 6or estate tax purposes$ the estate of the decedent shall be valued at the time a. of the preparation of the estate tax return b. the estate tax is paid. c. of death of the decedent. d. The estate is distributed to the heirs.12. :amo died leaving the follo&ing propertiesA tocks of ru+ orporation D2$--- shares E/ listed in the )hisex Dhighest/ ) 4-< lo&est/ ) 3*E. ommon tocks of emo orporation D 1$!-- sharesE/ not listed in the stock exchange. ost/ ) !- per share< book value/ )4! per share. ar D cost/ ) --$---< book value/ ) 3!-$---< market value F ) 4--$---E Geal properties D +onal value F ) 12-$---< assessed value/ ) #2$--- E The gross estate of :amo is/a.) 1($--- c. ) 24$---b.( #$--- d. $!--13.9ne of the follo&ing is sub'ect to estate tax on properties situated &ithin the )hilippines onlya. Gesident citi+en c. 8onresident citi+en b. Gesident alien d. 8onresident alientems 14 through 1 are based on the follo&ing informationA @ina :athay$ 6ilipina$ died in the Hnited tates &ith the follo&ing properties ondominium unit in 8e& Iork ity ) 2$---$---   hares of stock in a foreign corporation --$--- nterest in a partnership$ domestic 4#!$--- Bank deposit in a 8e& Iork ity bank 1!-$--- ar in ebu$ @onated inter vivos ! years ago to her son !--$---14.>hich property should be included in the gross estate? a. ll the above properties. b. 9nly the properties located in the )hilippines c. ll the above properties except the car. d. The properties located in the )hilippines except the intangibles.1!.f the decedent &as a nonresident alien D &ith reciprocityE$ ho& much is the gross estate? a. ) 3$#2!$--- c. ) !--$--- b. *#!$--- d. 8one1 . f the decedent &as a nonresident alien D no reciprocity E$ ho& much is the gross estate? a. ) 3$#2!$--- c. ) !--$--- b. *#!$--- d. 4#!$--- >henever a decedent is a nonresident alien D no reciprocity E$ all properties situated in the )hilippines D real property $ tangible personal property and intangible personal property are included in his gross estate.1#. >hich of the follo&ing is an intangible personal property &ithin? a. 6ranchise exercised in the Hnited tates. b. hares or rights in a domestic business partnership. c. Bonds issued by an merican corporation. d. tocks issued by foreign corporation &ith business situs in the )hilippines. a. B only c. ll of the above properties b. B and @ d. 8one of the above properties1(. n example of intangible personal property &ithout is a. @omestic shares of stock b. 6oreign shares$ (! J of the business of the corporation is in the )hilippines. c. 6oreign shares &ith business situs in the )hilippines. d. 6oreign shares$ certi,cate of stock are kept in :akati.1*. 9ne of the follo&ing donations is not included as part of gross estate. a. revocable transfers b. transfers &ith reservation of certain rights c. transfers under special po&er of appointment d. transfers in contemplation of death n a special po&er of appointment$ the decedent is considered only as a trustee to the property. ence$ said property should not be a part of his estate.2-. >hich of the follo&ing transfers is included in the gross estate? a. transfer inter vivos b. transfer under general po&er of appointment c. transfer under special po&er of appointment d. transfer for an ade5uate and full consideration21. @ecedent Kulot . has the follo&ing dataA =alue of the property at the time of sale ) 1$2--$--- =alue of consideration &hen sold 1$---$--- =alue of property at the time of death 1$!--$--- The amount includible in the gross estate is F a. ) 3--$--- c. ) 2--$--- b. !--$--- d. 1$!--$---22. >hen lbino &as informed by his physician that he &as about to die of cancer$ he sold his propertiesA :arket value/ elling :arket value/ @ate of sale price @ate of deathLand ) 2$#--$--- ) 1$!--$--- ) 2$#--$--- Ce&elries !--$--- 3--$--- 3--$---hares of stocks 2--$--- 22-$--- 2!-$--- Transfer under limited )o&er of appointment 1$---$--- --$--- (--$---
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