Estate Planning Please provide little explanation with the answers. ............

Question

Estate Planning

Please provide little explanation with the answers.

............................................................................

1- Does portability apply to the same-sex married couples in Texas?

(A)    Yes, since the federal Defense of Marriage Act was determined to be unconstitutional, same-sex couples are entitled to equal protection under the law.

(B)    No, because Texas does not recognize same-sex marriages.

............................................................................

2- What are the reasons for utilizing a bypass trust after ATRA?

            (A)    Sheltering appreciation between the first and second deaths.

            (B)    Protection from creditors of the surviving spouse.

            (C)    Preserving deceased spouse’s GST exemption amount.

            (D)    Protecting children from prior marriage of first spouse to die.

            (E)    All of the above.

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3- All the following provisions are usually included in an insured stock cross-purchase buy-sell agreement EXCEPT:

A. A provision giving each surviving stockholder an option to buy a proportionate part of a deceased’s stock.

B. A provision establishing the purchase price to be paid for the stock of a deceased stockholder.

C. A provision committing each stockholder to buy and maintain life insurance on the other stockholders.

D. A provision permitting each surviving stockholder to buy from the estate of a deceased stockholder the life insurance the deceased’s estate owns on the life of each surviving stockholder.

Explanation / Answer

1 Does portability apply to the same-sex married couples in Texas?

(A)    Yes, since the federal Defense of Marriage Act was determined to be unconstitutional, same-sex couples are entitled to equal protection under the law.

-because Every taxpayer, regardless of marital status, can give anyone else thousands of dollars each year without immediate tax consequences.

2- What are the reasons for utilizing a bypass trust after ATRA?

(B)    Protection from creditors of the surviving spouse.because The assets included in the bypass trust should provide the spouse with some level of creditor protection as the spouse would be a potential beneficiary of the trust but not actually own the assets in the bypass trust.

3- All the following provisions are usually included in an insured stock cross-purchase buy-sell agreement EXCEPT:

A. A provision giving each surviving stockholder an option to buy a proportionate part of a deceased’s stock.(not sure)

Read more: http://www.bankrate.com/finance/taxes/estate-tax-issues-same-sex-marriage.aspx#ixzz3sayvfJP0
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