NALA Certification Estate Planning & Probate Test Questions & Answers 2022
- ANSWERSFact:
- Wills and Living Wills are not the same thing.
- If one does not prepare a will, the estate will go to the surviving relatives per the laws of intestate succession. An estate escheats to the state...
- If one does not prepare a will, the estate will go to the surviving relatives per the laws of intestate
succession. An estate escheats to the state if there are no surviving blood relatives or next of kin, which
is a rare occasion.
- Preparing a will does not necessarily avoid probate.
- A durable POA becomes inoperative upon death of the principal.
- Revocable living trusts do not avoid income or estate taxes. A revocable living trust is a legal entity
created to hold the grantor's assets and is subject to taxes.
Estate Planning - ANSWERS* Estate Planning - the preparation of legal documents setting forth one's
wishes how to manage one's personal and financial affairs prior to death or in the event of incapacity.
* Estate Planning occurs during a person's lifetime.
* Without Estate Planning, one will rely on the laws of the state to determine who manages and controls
the personal and financial affairs upon incapacity or death.
Estate Administration - ANSWERS* Estate Administration - the process of collecting the decedent's
property, paying the decedent's debts, and distributing the remainder of the decedent's property to the
beneficiaries or the heirs at law.
,* Estate Administration occurs after death.
* An estate consists of all the property owned by a person at the time of death.
Real & Personal Property - ANSWERS* There are 2 main classifications of property:
1. Real
2. Personal
* The individual must have actual title to the property in order to dispose of it by gift, will or through a
trust.
Ownership: Joint Tenancy - ANSWERS* Joint Tenancy - a form of ownership by 2 or more parties having
an equal share and right to the property.
* Upon the death of one of the parties, that decedent's share will transfer to the remaining joint tenant
through operation of law and avoid probate administration.
* Joint Tenancy is right by survivorship and does not pass to beneficiaries or heirs through a will, trust, or
interstate succession.
Ownership: Tenancy in Common - ANSWERS* Tenancy in Common - it differs from Joint Tenancy in that
there is no right of survivorship, and the ownership by the parties is a separate transferable interest.
* If there are 2 parties in Tenancy in Common and 1 party dies, that decedent's interest in the property
does not transfer to the tenant in common through survivorship.
* That decedent's interest transfers testate or intestate procedures, meaning the surviving tenant in
common will now be a co-owner with the decedent's beneficiaries or heirs.
Ownership: Tenancy by the Entirety - ANSWERS* Tenancy by the Entirety - upon death of 1 spouse, the
property automatically passes to the surviving spouse.
, * Tenancy by the Entirety is only for legally married persons.
* Tenancy by the Entirety is not available for community property states.
Ownership: Community Property - ANSWERS* Community Property - property acquired during marriage
and owned equally by both spouses (undivided 1/2 interest per spouse). Assets that come into marriage
during the marriage through any means other than inheritance or gift.
* States (9) that recognize Community Property as a form of ownership for legally married persons:
1. Arizona
2. California
3. Idaho
4.Lousisiana
5. Nevada
6. New Mexico
7. Texas
8. Washington
9. Wisconsin
Ownership: Community Property with Right of Survivorship - ANSWERS* States (6) that recognize this:
1. Alaska
2. Arizona
3. California
4. Idaho
5. Nevada
6. Wisconsin
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