Wills, trusts, and gift and estate tax concepts tested on the CFP estate planning domain.
38 cards · basic cards · AI-written, checked twice. Edit anything.
- What is an estate?
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The total value of all assets and property owned by an individual at death.- What is probate?
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The court-supervised legal process of validating a will and distributing an estate's assets according to law.- What is testamentary capacity?
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The legal and mental ability to make a valid will, requiring understanding of one's assets, family, and the will's effects.- What is a holographic will?
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A handwritten will entirely in the testator's own handwriting, recognized in some states without witness requirements.- What is a nuncupative will?
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An oral will made by a testator before witnesses, valid in limited circumstances in some jurisdictions.- What is the key characteristic of joint tenancy?
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Right of survivorship: when one joint tenant dies, the surviving tenant(s) automatically own the deceased's share.- What happens to a tenant in common's property interest at death?
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The interest passes to the deceased tenant's estate, not automatically to the other tenants; there is no right of survivorship.- What is tenancy by the entirety?
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A form of joint ownership for married couples with rights of survivorship, recognized in some states only.- In community property states, how is property acquired during marriage classified?
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Property acquired during marriage is community property, owned equally by both spouses, unless acquired as separate property.- What is a trust?
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A legal arrangement where a trustee holds title to property for the benefit of designated beneficiaries.- What is a revocable living trust?
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A trust created during the grantor's lifetime that can be modified or terminated by the grantor; avoids probate at death.- What is an irrevocable trust?
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A trust that cannot be amended or revoked once created; assets are removed from the grantor's taxable estate.- What is a testamentary trust?
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A trust created by the terms of a will that takes effect only after the testator's death.- What does a spendthrift provision accomplish?
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It prevents beneficiaries from assigning their interest and shields trust assets from beneficiary creditors.- What does a charitable remainder trust (CRT) provide?
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Income to non-charitable beneficiaries for a specified term, then the remainder passes to charity; provides an income tax deduction.
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