Please answer all 5 questions and show all of your work so that I can follow along!!!

Question 1

Chuck and Nancy take their pet rock company public and are soon multimillionaires. Recognizing the volatility facing the pet rock industry, Chuck paid 60% of the cost for a $5M joint

and survivor annuity that pays $200K a year. A comparable annuity for Nancy based on her current age would cost $4M and at original purchase age would cost $6M. Chuck dies in a

freak rock stampede 5 years later. What amount will be in his GE?

	A.	$0
	B.	$200,000
	C.	$2,400,000
	D.	$5,000,000

Question 2

A father deeded a house as a gift to his daughter 20 years ago but retained the right to live in it until his death. He died this year while still living in the house. The following are relevant facts: The father bought the property in 1982 for $60,000. The fair market value of the property when the gift was made in 1995 was $140,000. The father filed a timely gift tax return but paid no gift tax because of the basic credit amount. The fair market value of the property at the fathers death was $190,000. The daughter sold the property 3 months after her fathers death for $190,000. She had a gain of

	A.	$0
	B.	$50,000
	C.	$130,000
	D.	$190,000

Question 3

Mike makes the following transfers:

2 years ago:

Life insurance policy to his cousin, $1M DB, $250 CSV

$100,000 Stock Portfolio to his sister

$50,000 RV to his son

Paid gift taxes of $55,000

Last year:

$50,000 cash to brother

Paid $10,000 in gift taxes

He died this year owning a $250,000 home ($100,000 basis) tenancy by the entirety, $50,000 stock portfolio, $500,000 in his 401K with his wife named as the

beneficiary, a $50,000 car, and $25,000 in cash.

Calculate his gross estate.

	A.	$1,815,000
	B.	$815,000
	C.	$325,000
	D.	$0

Question 4

Chuck and Nancy take their pet rock company public and are soon multimillionaires. Recognizing the volatility facing the pet rock industry, Chuck purchased a $5M

straight life annuity that pays $200K a year. Chuck dies in a freak rock stampede 5 years later. What amount will be in his GE?

	A.	$0
	B.	$200,000
	C.	$2,400,000
	D.	$5,000,000

Question 5

Mike makes the following transfers:

2 years ago:

SOLD the life insurance policy to his cousin, $1M DB, $250 CSV

$100,000 Stock Portfolio to his sister

$50,000 RV to his son

Paid gift taxes of $55,000

Last year:

$50,000 cash to brother

Paid $10,000 in gift taxes

He died this year owning a $250,000 home ($100,000 basis) tenancy by the entirety, $50,000 stock portfolio, $500,000 in his 401K with his wife named as the

beneficiary, a $50,000 car, and $25,000 in cash.

Calculate his gross estate.

	A.	$1,815,000
	B.	$815,000
	C.	$325,000
	D.	$0