CLA/CP Exam Estate Planning and Probate 3

Question 1

Which type of joint tenancy feature automatically transfers a deceased owner's share to surviving co-owners?

Accepted Answer

Right of survivorship

Answer

The right of survivorship in joint tenancy causes a deceased co-owner's interest to automatically vest in surviving joint tenants without probate.

Question 2

What is the primary purpose of a spendthrift clause in a trust?

Accepted Answer

To prevent beneficiaries from assigning their interest to creditors

Answer

A spendthrift clause prohibits beneficiaries from voluntarily transferring their interest and shields it from most creditor claims before distribution.

Question 3

Under federal estate tax law, the unlimited marital deduction applies to transfers made to:

Accepted Answer

A U.S. citizen spouse

Answer

The unlimited marital deduction allows an unlimited amount to pass estate-tax-free to a surviving spouse who is a U.S. citizen.

Question 4

A Qualified Terminable Interest Property (QTIP) trust is most commonly used to:

Accepted Answer

Provide income to a surviving spouse while controlling remainder beneficiaries

Answer

A QTIP trust qualifies for the marital deduction and provides income to the surviving spouse, but the grantor controls who receives remaining assets at the spouse's death.

Question 5

Which probate procedure is typically available for small estates and eliminates formal court supervision?

Accepted Answer

Summary administration

Answer

Summary administration (or small estate affidavit procedures) allows heirs to collect assets without full probate when the estate value falls below a statutory threshold.

CLA/CP Exam Practice Test

CLA/CP Exam Practice Test

CLA/CP Exam Estate Planning and Probate 3