Estate, Gift & Trust: Estate, Gift & Trust Basics
Estate, Gift & Trust: Estate, Gift & Trust Basics is a critical concept in EA Exam Part 1, Specialized Returns. This topic covers essential tax principles that frequently appear on the exam. Understanding estate, gift & trust basics is crucial for passing Part 1.
Quick answer
Estate, gift, and trust basics introduce the transfer-tax system on Part 1. The EA exam tests the annual gift-tax exclusion, the unified credit/exclusion concept, and which transfers are taxable gifts versus excluded ones.
Estate, Gift & Trust Basics is tested on EA Exam Part 1 (Specialized Returns). Primary IRS reference: IRS Publication 559.
About this EA exam topic
Estate, gift, and trust basics introduce the transfer-tax system on Part 1. The EA exam tests the annual gift-tax exclusion, the unified credit/exclusion concept, and which transfers are taxable gifts versus excluded ones.
Trust questions test the difference between simple and complex trusts and the basics of distributable net income. Expect conceptual questions rather than full estate-tax computations.
What you'll be tested on
- Annual gift-tax exclusion and what is a taxable gift
- The unified credit / lifetime exclusion concept
- Simple vs. complex trusts
- Basis rules for gifted vs. inherited property
How to prepare
- Distinguish gift-splitting and the annual exclusion from the lifetime exclusion.
- Memorize carryover basis for gifts vs. stepped-up basis for inheritances.
- Know simple-trust requirements.
Practice questions for Estate, Gift & Trust Basics
What this topic covers
Estate, Gift & Trust Basics appears in Part 1: Individual Taxation within the Specialized Returns domain. VantageEA practice questions focus on how estate, gift & trust rules are applied in realistic EA exam fact patterns.
What candidates practice
Candidates practice identifying tested facts, choosing the best multiple-choice answer, and reviewing explanations tied to IRS Publication 559, IRC §2001, IRC §2503, IRC §2010. This topic supports timed 100-question PSI-style mock tests and shorter topic review sessions.
Related practice-question themes include estate-tax, gift-tax, trust, annual-exclusion.
Topic overview
Official IRS sources
Related keywords
Frequently asked questions
Is inherited property basis stepped up?
Generally yes, to fair market value at death, unlike gifted property which usually takes carryover basis.
Which part?
Part 1 (Individuals), specialized returns.
Reference?
IRS Publications 559 and 950-era estate/gift guidance.
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More Specialized Returns topics from Part 1
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