2010 and 2011 have been the most exciting years in a long time for estate law. Depending on the time of death and the condition of their wills, the deceased's families had to deal with all kinds of changes -- some of them permanent, many only temporary. Now more than ever, it's important to know what you're dealing with when it comes to inheritance. Test your knowledge with our quiz!
What's the upper limit on a spouse's inheritance before it's subject to taxes?
A spouse can inherit up to $1 million before paying estate taxes.
A spouse can inherit up to $675,000 before paying estate taxes.
The limit doesn't exist.
Distributions from an inherited IRA will incur how much of an early distribution penalty?
Up to established gift-tax limits, there are no penalties for early distribution.
Penalties for an inherited IRA are the same as for your own.
There is no penalty.
How soon do you have to return money borrowed from an inherited IRA before paying taxes or penalties?
In 60 days, just like with a regular IRA
All withdrawals from an inherited IRA are taxed.
No withdrawals from an inherited IRA are taxed.
How long do you have to disclaim a bequest?
Nine months from the death, or whenever the beneficiary comes of age
As long as you don't use the money or property, there's no time limit.
One tax year following the end of the year in which the death occurred.
How should you file your qualified disclaimer with the IRS?
Attach it to the IRS Gift Tax Return, noting that you have disclaimed the interest and thus owe no taxes.
No report is required, since you never legally came into contact with the property or interest.
The executor files the necessary forms at the time of distribution to the new heir.
How do you go about deciding who gets your inheritance if you disclaim it?
You're limited to family designees or those named in the will and other estate documents.
A form for rerouted distribution of the properties will be filed at the time of the disclaimer.
You have no say in this matter.
Before 2010, how much did the IRS's estate tax lawyers find owed to the government every hour, on average?
Before the 2010 Tax Relief Act, how much could you leave your beneficiaries before taxes kicked in?
There was no limit.
After the 2010 Tax Relief Act, when will taxes revert and the increases return?
Jan. 1, 2012
Apr. 15, 2015
Jan. 1, 2013
What interesting bequeathal did Shakespeare make to his wife?
One-third of his property was automatically awarded to her, due to laws at the time.
He left her the "second best bed."
He didn't mention his wife in his last will and testament.