Which Is an Example of a Qualified Terminable Interest Property

question 26

Multiple Choice

Which is an example of a Qualified Terminable Interest Property QTIP) property?

• A)A trust with a life interest to the surviving spouse and remainder to the children
• B)An automobile
• C)A homestead
• D)A life insurance policy with a one-time lump sum payment to the surviving spouse

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Definitions:

Equity

The value of an ownership interest in property, including shareholders' equity in a corporation, representing the residual value to shareholders after debts and liabilities have been settled.

Efficiency

The ability to accomplish or produce a desired result with the minimum amount of waste, effort, or inefficiency.

Trade-Off

A scenario where one characteristic or element is sacrificed to acquire a different characteristic or element.

Price System

The price system is the mechanism through which prices are determined for goods and services in an economy, facilitating the allocation of resources, signaling what to produce and consume, and coordinating economic activity.