American College Exam HS330 Topic 2 Question 98 Discussion

Actual exam question for American College's HS330 exam

Question #: 98
Topic #: 2

A woman is the income beneficiary of an irrevocable trust. All the following powers held by her will cause all the assets in the trust to be includible in her gross estate for federal estate tax purposes EXCEPT:

Athe testamentary power to direct the trustee to use trust assets to pay her estate taxes

Bthe power to direct the trustee to distribute trust corpus to her

Cthe testamentary special or limited power to direct the trustee to distribute trust assets to her children

Dthe testamentary power to direct the trustee to pay trust assets to her estate

Show Suggested Answer

Suggested Answer: C

by Zona at Sep 13, 2024, 02:58 AM

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Ruth

2 months ago

Wait, wait, wait... I've got it! The answer is E) the power to make the trustee wear a clown costume while distributing the assets. Clearly, that's the exception here.

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James

1 months ago

C) the testamentary special or limited power to direct the trustee to distribute trust assets to her children

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Charolette

1 months ago

B) the power to direct the trustee to distribute trust corpus to her

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Abel

1 months ago

A) the testamentary power to direct the trustee to use trust assets to pay her estate taxes

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Sylvie

2 months ago

Ooh, this is a good one. I'm leaning towards D, the testamentary power to direct the trustee to pay trust assets to her estate. That just seems too direct to not be included in her gross estate.

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Jesusita

2 months ago

But doesn't C involve distributing assets to her children, not herself?

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Kattie

2 months ago

Ha! Estate tax questions, my favorite. I bet the answer is C, the testamentary special or limited power to direct the trustee to distribute trust assets to her children. That's the only one that seems to fit the 'EXCEPT' criteria.

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Tyra

1 months ago

I guess we'll have to wait and see what the correct answer is.

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Jacinta

1 months ago

That could also be a possibility, but I still think C is the best choice.

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Latricia

1 months ago

But what about D, the testamentary power to direct the trustee to pay trust assets to her estate?

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Glen

2 months ago

I think you're right, C does seem to be the odd one out.

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Gerald

2 months ago

I'm not too sure about this one. The testamentary powers seem like they would cause the assets to be included, but the wording of 'EXCEPT' is throwing me off. I'll have to think this through carefully.

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Jesus

2 months ago

I disagree, I believe the answer is D.

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Kirk

3 months ago

Hmm, this seems like a tricky one. I'm going to go with B, the power to direct the trustee to distribute trust corpus to her. That seems like it would cause the assets to be included in her gross estate.

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