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GiftLaw Pro Home   >  Chapter 3 - Deferred Gifts  >  3.9 Revocable Trust  >  3.9.1 Revocable Trust - Liquidity and Probate  >  Basic Quiz

Basic Quiz - 3.9.1 Revocable Trust - Liquidity and Probate

1. As Americans continue to live longer lives, it becomes more and more important to create an estate plan that will take into account the likelihood of death at a very advanced age.
           
2. As a general rule, a person should transfer 3/4 of their estate into an irrevocable trust.
           
3. Because a charitable remainder trust allows the bypass of capital gain, income tax savings and increased income, a prudent donor will distribute as many assets into the charitable remainder trust, during life, as possible.
           
4. In some moderate and smaller estates, an irrevocable transfer of property is not recommended if it would put too great a burden and uncertainty upon the liquidity of the remaining estate.
           
5. The creation of a living trust is a complete will substitute.
           
6. The best reason for creating a living trust is that assets inside the living trust will not be subject to estate tax.
           
7. A living trust provides certain advantages that a will can not provide.
           
8. A charity may not serve as trustee of a revocable trust because of the inherent conflict of interest.
           
9. A revocable trust may allow the donor to receive all of the trust income; however, the donor may not invade principal for any reason.
           
10. At death of the grantor, the remaining trust corpus may be distributed to the one or more named qualified charities. This distribution will entitle the estate to a charitable estate tax deduction.