The American Academy of Estate Planning Attorneys The American Academy of Estate Planning Attorneys

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Estate Planning IQ Quiz

When it comes to estate planning, we've come a long way from the days when the pioneers scrawled hand-written wills on the backs of paper bags. Today, the thicket of estate planning and tax law demands you take the right steps to preserve your hard-earned wealth and make sure all of your estate goes to your intended beneficiaries. Take a moment to complete the American Academy of Estate Planning Attorneys' Estate Planning IQ Quiz and find out your EPIQ. You'll be able to compare your answers to others who also took the quiz. Good luck!

1) "Probate" is:
a) a legal process that makes sure your loved ones receive the assets in your estate in a timely, private and inexpensive fashion
b) an expensive, time-consuming and public legal process that can eat away at assets I hope to leave to my loved ones.
c) money I can get back from a dealer when buying a new car.
d) a document estate planning attorneys file to pay federal estate taxes.

2) If I have a will created, my estate will avoid probate.
a) True
b) False

3) A Living Trust is:
a) an estate plan that, like a will, is subject to probate.
b) an estate plan, that unlike a will, avoids probate.
c) a pledge one makes when marrying.
d) a public company that sells life insurance.

4) The federal estate tax (also known as the death tax) starts at ____ and rises to as much as ______for every dollar over the exempt amount.
a) $2--$5
b) 10 percent-20 percent
c) 60 percent-87 percent
d) 41 percent-55 percent

5) In 2002, the federal government has given every person in the United States an exemption of _________ for estate tax purposes?
a) $675,000
b) $925,000
c) $1 million
d) $1.3 million

6) In computing whether your estate exceeds the estate tax exemption limit, the government includes the following:
a) Your house, car, stocks and bonds.
b) Everything you own, including the face value of your life insurance policies.
c) Everything you own, excluding the face value of your life insurance policies.
d) Everything you own, excluding life insurance policies and collectibles such as heirlooms and baseball card collections.

7) The Federal Estate Tax Unlimited Marital Deduction does which of the following?
a) Eliminates federal estate tax if you are still married when you die.
b) Postpones federal estate tax until the second spouse dies; i.e., no federal estate tax is levied when the first spouse dies and leaves the estate to the surviving spouse.
c) Allows you to deduct the costs of the marriage from your estate; that's why it's called a marital deduction.
d) Eliminates federal estate tax no matter how much in assets has been accumulated; that's why it's called the unlimited marital deduction.

8) Financial planning, including long-term health care, is increasingly important because there are more seniors than ever before and they are living longer, placing a strain on long-term health care resources. According to the U.S. Census Bureau, America's population 65 and over grew by ________percent between 1965 and 1995.
a) 33
b) 50
c) 67
d) 82

9) What is a Roth IRA?
a) An individual retirement account that allows you to invest in tax-free municipal bonds.
b) An individual retirement account in which earnings are tax-deferred at the time of withdrawal.
c) An individual retirement account in which earnings are tax free at the time of withdrawal for qualified distributions.
d) A baseball term meaning "individual runs average" and named after slow-footed outfielder Philip Roth.

10) The best source for information on effective estate planning that will preserve your wealth is:
a) Oprah
b) A friend in the business
c) A probate lawyer
d) The American Academy of Estate Planning Attorneys and their members across the nation.