1 of 24 

*
Mr X gifted a land to his friend for Rs. 1.50 lakhs. The stamp duty value is Rs. 4 lakhs. What
is the taxable value of the gift?
Rs. 7,500
 
Rs. 1,50,000
 
Rs. 2.50 lakhs
 
Rs. 50,000

2 of 24 *
Can share in a HUF be bequeathed?
Yes, share in a HUF can be bequeathed
 
No, share in a HUF cannot be bequeathed.
 
Share in a HUF can be bequeathed by a Senior Citizen
 
Share in a HUF can be bequeathed only by the Karta

3 of 24*
The main objective is that the trust should be created for a lawful purpose. As per Section 4,
all purposes are said to be lawful unless it: A. Is forbidden by law B. Defeats the provisions
of law C. Is fraudulent D. Involves injury to another person or his property E. Immoral or
against to public policy
All of the above
 
Point A, B and C
 
Point C, D and E
 
Point B, C and D

4 of 24 *
FPSB has categorized the financial planner competencies into three financial planning
functions: Collection, Analysis and Synthesis. Which of the following list of selected steps in
the estate planning process is most likely correct?

Project net worth at death. Assess the client’s attitudes and biases toward estate planning.
Assess the liquidity of the estate at death. Evaluate the advantages and disadvantages of each
estate planning strategy
 
Identify the client’s estate planning objectives. Project net worth at death. Assess the specific
needs of beneficiaries. Optimize strategies to make estate planning recommendations.
Analyze constraints to meeting the client’s estate planning objectives.
 
Collect legal agreements and documents impacting estate planning strategies. Compare
potential estate planning strategies. Evaluate the advantages and disadvantages of each estate
planning strategy. Analyze constraints to meeting the client’s estate planning objectives
 
Assess the client’s attitudes and biases toward estate planning. Calculate potential expenses
and taxes owed at death. Prioritize action steps to assist the client in implementing estate
planning recommendations.

5 of 24 *
Which of the following statements regarding the taxation of trust income is most likely
correct?
Trust income is always taxed to the trustee.
 
If a trust is a grantor trust, all trust income is taxed to the grantor.
 
Trust income is always taxed to the beneficiary.
 
Trust income is taxed to the trust if the trustee distributes the entire trust income annually.

6 of 24 *
Many people get at least a little uncomfortable considering a time when they no longer
maintain enough control to effectively manage their own affairs. Nonetheless, incapacity is a
fact of life for many, and likely will continue, especially as the overall population grows
older. It may be a difficult conversation, but it’s an area financial planners should cover with
clients. There is a transitional state of cognitive functioning between “normal” and having
dementia. This is referred to as Mild Cognitive Impairment (MCI). A financial planner may
notice some signs of MCI. Which of the following statemenst regarding Mild Cognitive
Impairment (MCI) is least likely correct?

Aging is the only causal factor of MCI.

 
As a financial planner, you cannot do an analysis, but when working with a client, you may
notice some signs of MCI.
 
Sometimes, MCI can revert to a more normal state, but other times, it progresses to dementia.
 
Mild cognitive impairment (MCI) causes a slight, but noticeable and measurable decline in
cognitive abilities, including memory and thinking skills.
 7 of 24 *
When can a trust get extinguished? A. When its purpose is completely fulfilled, or B. When
its purpose becomes unlawful, or C. When the fulfilment of its purpose becomes impossible
by destruction of the trust-property or otherwise, or D. When the trust being revocable, is
expressly revoked.

Only if Point A or Point B happen

 
Only If Point A or Point C happen
 
Only if Point A happens
 
If any of the above points happen

8 of 24 *
Muslim law recognises which of the following two types of heirs? A. Sharers B. Residuaries
C. Receivers D. Acceptors
B and C
 
C and D
 
A and B
 
A and D

9 of 24 *
What is a Will Substitute?
A “Will Substitute” is an instrument that transfers ownership of a property from the trustee to
the beneficiary upon the trustee’s death while avoiding probate.
 
A “Will Substitute” is an instrument that cancels the ownership of a property
 
A “Will Substitute” is an instrument that transfers ownership of a property from the
beneficiary to the owner upon the beneficiary’s death while avoiding probate.
 
A “Will Substitute” is an instrument that transfers ownership of a property from the owner to
the beneficiary upon the owner’s death while avoiding probate.

10 of 24 *
Your client Josh is an owner of an apartment that he pruchased with his brother Brad together
12 years ago for €200,000 with a tenancy in common agreement. Josh contributed 25% and
Brad contributed 75%. Today the house is valued at €550,000. There is a 50% capital gains
tax in the territory. You are helping Josh to determine his estate value at death. Both brothers
have children and their will's leave everything to their children. If Brad dies today, what is
the gross estate value inherited by Josh?
€0
 
€ 350,000
 
€ 412,500
 
€ 137,500

11 of 24 *
Which of the following statements is FALSE? 1. Testamentary succession is the succession
in which the property is transferred as per the will made by the person after his death. 2.
Intestate succession is when a person holding the ownership of the property passes away
without making any proper will

Point 2 is False
 
Both are False
 
Point 1 is False
 
Both are True

12 of 24 *
What is the difference between beneficiary and nominee?
Nominee and Beneficiary are the same person.
 
Beneficiary is merely a trustee of the property and he / she is required to hand it over to the
legal heir whereas nominee is the person entitled to receive the properties under the will.
 
Nominee registers the will whereas Beneficiary is the person entitled to receive the properties
under the will.
 
Nominee is merely a trustee of the property and he / she is required to hand it over to the
legal heir whereas Beneficiary is the person entitled to receive the properties under the will.

13 of 24 *
Which of the following statements are correct related to Trust? A. Author – Person who
creates the trust B. Beneficiary – The person for whose benefit the trust is created or the
confidence is accepted C. Trust Deed – Agreement executed between the settlor and the
Managing Trustee of the trust D. Managing Trustee – Person who manages the activities of
the trust
All the statements are wrong
 
Only statements A and C are correct
 
Only statements B and D is are correct
 
All the statements are correct

14 of 24 *
A trust that is created by a decedent's will and made effective at death is most likely a(n):
Testamentary trust.
 
Irrevocable trust.
 
Revocable trust.
 
Inter vivos trust

15 of 24 *
Which of the following documents needs to be submitted for obtaining Probate? 1. Original
Will of the deceased 2. Title Deeds pertaining to the immovable property mentioned in the
Will, if any 3. Documents pertaining to the movable property, mentioned in the Will, if any

Point 1 and 3 are needed

 
Point 1 and 2 are needed
 
All the three are needed
 
None of them are needed

16 of 24 *
When a small business has more than one owner (whether a corporation or partnership), the
remaining owners may wish to purchase the decedent’s share. Which of the following
statements regarding buy-sell agreements is most likely true?

In a buy-sell cross purchase method, the business entity purchases the interest of an owner
who dies. This method provides for the continuation of the business in the hands of the
surviving owners.
 
In a buy-sell cross-purchase method, the partnership purchases life insurance on the lives of
each partner. This method cannot affect the value of the business for estate tax purposes.
 
In a buy-sell entity purchase method, the business entity purchases the interest of an owner
who dies. This method guarantees a market for the business interest when an owner dies.
 
In a buy-sell entity purchase method, the business entity purchases the interest of an owner
who dies. This method guarantees a market for the business interest when an owner dies.

17 of 24 *
Four partners (A,B,C,D) have an equal 1/4 interest in a partnership valued at €24,000,000. If
the partners use the buy-sell cross purchase method, how much coverage should partner B
have on the life of each of the other partners?
€ 24,000,000
 
€ 2,000,000
 
€ 6,000,000
 
€ 8,000,000

18 of 24 *
You are meeting with your client who will be a grantor to a trust. You are helping to asses the
specific needs of the beneficiraries and the constraints of trusts to meeting the estate planning
goals. Your client wants to give up all right, title, and interest in the trust corpus and wants to
know more about the tax implications. Which of the following most likely meets the specific
needs of both the grantor and the beneficiaries?

A grantor trust. Trust assets being taxed to the grantor.

 
A nongrantor trust. Trust assets being taxed to the grantor.
 
A nongrantor trust. Trust assets being taxed to the beneficiary.
 
A grantor trust. Trust assets being taxed to the beneficiary.

19 of 24 *
Which of the following statements are False in case of a Power of Attorney? A. The person
who grants the power to the other person to act on his behalf is termed the grantor or
principal or donor. B. The person to whom the power is granted is termed the Attorney or
agent or donee. C. The person to whom the power is granted is termed the receiver or
acceptor.
All the statements are False
 
Statement B is False
 
Statement A is False
 
Statement C is False
 20 of 24 *
Your client is asking for some investment advice regarding real assets. Your client and his
two brothers plan to purchase an office building together. One brother will contribute 50% of
the purchase price, and the other two brothers will contribute 25%. The brothers want title to
the property to reflect their respective ownership shares of 50%, 25%, and 25%. The brothers
want the ability to leave their interests to whomever they choose under their wills. Which of
the following forms of property ownership will meet the brothers' objectives?
Tenants by the entirety.
 
Community property.
 
Joint tenancy.
 
Tenants in common.

21 of 24 *
Who are included under the Hindu Succession Act?

The Act specifically oversees the succession of Hindus, including Jains, Buddhists, Sikhs,
Christians, Parsis, Jews, excluding Muslims and people of Jammu and Kashmir.
 
The Act specifically oversees the succession of Hindus, including Jains, Buddhists, Sikhs,
Muslims, Christians, Parsis, Jews, and people of Jammu and Kashmir.
 
The Act specifically oversees the succession of Hindus only.
 
The Act specifically oversees the succession of Hindus, including Jains, Buddhists, and Sikhs
excluding Muslims, Christians, Parsis, Jews, and people of Jammu and Kashmir.

22 of 24 *
Estate-related transfers may be made during life or after death. Whether or not a decedent has
left a valid will, the estate distribution process will require a personal representative also
known as an executor. Which of the following statements regarding the role of an executor is
least likely correct?

The role of the executor includes accounting for the assets of the estate, paying outstanding
debts, distributing estate assets, and completing personal and estate income tax returns.
 
It is not a good idea to appoint an alternative executor.
 
When selecting the executor, it is important to consider the complexity of the estate, the skills
required, and the executor’s location.
 
Most territorial laws state that the executor is obligated to follow the instructions set out in a
will, subject to any limitations imposed by the law.
 23 of 24 *
You are meeting with your client who will be a grantor to a trust. You are helping to asses the
specific needs of the beneficiraries and the constraints of trusts to meeting the estate planning
goals. Your client wants to protect assets for their five children. Your client does not want to
give up immediate control of the assets and wants to know more about the tax implications.
Your client also wants to draw a 5% distribution from the trust for the next 10 years. Which
of the following statements regarding the taxation of trust income is most likely correct?

A nongrantor trust is one in which the grantor retains some degree of control over the trust.
They may be a trustee and may also be the beneficiary. Trust income is taxed to the trust as
the nongrantor trust rules apply.
 
A nongrantor trust is one in which the grantor retains some degree of control over the trust.
They may be a trustee and may also be the beneficiary. Trust income is taxed to the grantor
as the nongrantor trust rules apply.
 
A grantor trust is one in which the grantor retains some degree of control over the trust. They
may be a trustee and may also be the beneficiary. Trust income is taxed to the grantor as the
grantor trust rules apply.
 
A grantor trust is one in which the grantor retains no control over the trust. They may be a
trustee buy may not also be the beneficiary. Trust income is taxed to the grantor as the
grantor trust rules apply.

24 of 24 *
You are having a meeting with your clients and they want to know more about ways to help
their special needs child financially as they develop their estate planning strategies. Your
client wants a vehicle to hold cash or other assets that will be used to pay for necessary care,
housing and other expenses, and provide spending money for their child. You are helping to
assess the specific needs of the beneficiary and would most likely suggest which of the
following?

A special needs trust that will be used to pay for necessary care, housing and other expenses,
and provide spending money for the beneficiary. Typically, the grantor will oversee how trust
assets are distributed, including paying for caregivers, medical needs, housing, education, and
other expenses. Government funds also may be available to provide a portion of the
necessary financial support.
 
A special needs trust that will be used to pay for necessary care, housing and other expenses,
and provide spending money for the beneficiary. Typically, a trustee will oversee how trust
assets are distributed, including paying for caregivers, medical needs, housing, education, and
other expenses. Government funds also may be available to provide a portion of the
necessary financial support.
 
A special needs trust that will be used to pay for necessary care, housing and other expenses,
and provide spending money for the beneficiary. Typically, a trustee will oversee how trust
assets are distributed, including paying for caregivers, medical needs, housing, education, and
other expenses. Government funds may not be available to provide a portion of the necessary
financial support.
 
A special needs trust that will be used to pay for necessary care, housing and other expenses,
and provide spending money for the beneficiary. Typically, the beneficiary will oversee how
trust assets are distributed, including paying for caregivers, medical needs, housing,
education, and other expenses. Government funds also may be available to provide a portion
of the necessary financial support.