True or False

1. The list of properties of the decedent existing at the point of death must be established in
determining gross estate.
2. The gross estate of a non-resident citizen includes tangible properties wherever situated.
3. The gross estate of resident alien includes only real properties wherever situated.
4. Properties owned by the decedent which are exempted by law are initially included in gross
estate but are removed by way of deduction from gross estate.
5. Taxable transfers consists of properties passed to other persons before death but are still
owned by the decedent at the point of death.
6. Income earned after death are included in gross estate.
7. The payment for obligations and expenses after death is added back to the amount of gross
estate.
8. Properties held by the decedent as a trustee must be included in gross estate.
9. The proceeds of an irrevocable life insurance is included in gross estate.
10. The proceeds of life insurance which is revocable designated must be included in gross estate.

Multiple Choice

1. The gross estate of resident citizen decedents do not include

a. Properties located abroad
b. Properties located in the Philippines
c. Intangible personal property located abroad
d. Properties not owned

2. As a rule, all decedents are taxable on world estate, except

a. Non-resident alien
b. Non-resident citizen
c. Resident alien
d. Non-residents

3. Which has reciprocity exemption?

a. Resident alien
b. Non-resident alien
c. Non-resident citizen
d. All of these

4. Which of the properties may be excluded in gross estate by reason of reciprocity?

a. Cash
b. Car
c. Paintings
d. Land

5. If inventory taking of properties conducted after the death of the decedent, which is deducted
from the inventory list?
a. Income accruing after death
 b. Expenses paid after death
c. Income accruing before death
d. Expenses paid before death

6. Mrs. A appointed Ms. B as fiduciary heir over an agricultural land which Ms. B shall turn over to
Mr. C upon Ms. B’s death.

Which is correct?
a. The land must be included in Mrs. A’s gross estate upon her death
b. The land must be excluded in Ms. B’s gross estate upon her death
c. The land must be excluded in Mr. C’s gross estate upon his death
d. None of these

7. Mr. A designated Mr. K, the executor of his estate, as his irrevocable beneficiary to the proceeds
of his insurance.

Which is correct?
a. The proceeds of the life insurance policy shall be included in the gross estate of Mr. A
b. The proceeds of the life insurance policy shall be excluded in the gross estate of Mr. A
c. The proceeds of life insurance is a donation subject to donor’s tax
d. The proceeds is exempt from both donor’s tax and estate tax

8. Mr. A made an irrevocable donation in trust in favor of Mr. C. Mr. C died two years after
receiving the donation.

Which is correct?
a. The property shall be included in the gross estate of Mr. C.
b. The property shall be included in the gross estate of Mr. A.
c. The property shall be excluded in the gross estate of Mr. C.
d. None of these

9. Which of these transfer mortis causa will more likely to be included in gross estate of the
decedent?

Fair value at transfer Selling price at transfer Fair value at death

a. P 100,000 P 150,000 P 200,000

b. P 150,000 P 150,000 P 300,000
c. P 200,000 P 150,000 P 140,000
d. P 300,000 P 200,000 P 280,000

10. Which of the following properties is present at the point of death but is excluded from gross
estate?
a. Revocable transfer
b. Conditional transfer
 c. Transfer by bona fide sale
d. Proceeds of group insurance

11. Mrs. Dely Cado died on November 1, 2014. An inventory of her properties was conducted for
estate tax purposes of January 1, 2015. On that date, she had properties with aggregate fair
values of P 7,000,000. This amount includes P 300,000 income received by the estate since her
death and is net of P 600,000 expenses used during her funeral.

What is the amount of gross estate?

a. P 7,900,000
b. P 7,300,000
c. P 7,000,000
d. P 6,700,000

12. Mr. Bacleito had the following properties with their respective fair values in his possession at
the date of his death:

Agricultural land, held in trust P 200,000

Car, registered in the name of his brother P 300,000
Motorcycle P 80,000
Residential lot P 900,000
Other personal properties P 70,000

Compute the gross estate.

a. P 950,000
b. P 1,050,000
c. P 1,250,000
d. P 1,550,000

13. A decedent died in October 2012. His properties had aggregate fair value of P 12,000,000 at the
time. His heirs failed to pay his estate tax. In March 2014, his heirs prepared a list of the
decedents properties which now had a value of P 13,500,000 which excludes a car worth P
1,500,000 which was stolen on January 2014.

What is the gross estate?

a. P 0
b. P 12,000,000
c. P 13,500,000
d. P 15,000,000

14. A citizen decedent died leaving the following:

Properties, inherited from his father P 1,200,000

Properties, donated by brother 800,000
 Cash, from his salary savings 400,000
Cash, income of properties before death 200,000
Receivables, income of properties after death 100,000

Compute the gross estate.

a. P 2,400,000
b. P 3,900,000
c. P 4,400,000
d. P 5,680,000

15. A non-resident alien decedent died leaving the following:

A building in Korea 8,000,000

A car in Hongkong 2,000,000
Shares of stocks in Malaysia 4,000,000
Cash in Philippine banks 800,000
Investment in bonds of domestic corporation 400,000

Compute the gross estate.

a. P 0
b. P 800,000
c. P 1,200,000
d. P 11,200,000

16. Mrs. Candida died. In his last will and testament, he indicated the following:

House and lot, to his adopted son and only heir P 5,000,000
Land, to a public school 1,000,000
Cash, to ABS-CBN Foundation 500,000
The legacy to ABS-CBN Foundation is intended to Bantay Bata 163, a non-profit social welfare
program of ABS-CBN Foundation.

Compute the gross estate.

a. P 5,000,000
b. P 5,500,000
c. P 6,000,000
d. P 6,500,000

17. In his will, Anton transferred a life usutruct in favor of Cendog and thereafter to Bentong, who is
the owner of the naked title. Cendog eventually died resulting in the transfer of the property to
Bentong. Bentong also died few years later.

Which is correct?
a. The property shall not be included in the gross estate of Anton
 b. The property shall be included in the gross estate of Cendong
c. The property shall not be included in the gross estate of Bentong
d. The property shall be included in the gross estate of Anton and Bentong.

18. Mr. X devised in his will a commercial land to be given to Z, his favorite grandchild. Since Z is a
minor, Mr. X designated Mrs. Y as the fiduciary heir who is entrusted the obligation to transfer
the property to Z upon her death.

Which is correct?
a. The transfer of the property from Mr. X shall be subject to donor’s tax not to estate tax
b. The transfer from X to Z is subject to estate tax not to donor’s tax
c. The transfers from X and Y is not subject to any transfer tax
d. The transfer from Y to Z is subject to donor’s tax

19. Mr. Cabayo is the chief executive officer of Payaman Power Multilevel Marketing Corporation
(PMMC). Mr. Cabayo died in a car crash.

Which must be included in the gross estate of Mr. Cabayo?

a. Proceeds of life insurance taken by Mr. Cabayo with his eldest son as irrevocable beneficiary
b. Proceeds from Mr. Cabayo’s car insurance
c. Proceeds of the life insurance over Mr. Cabayo’s life taken by PMMC with PMMC as the
beneficiary
d. None of these

20. Mr. Dino Jones died leaving the following properties:

Car, purchased using GSIS retirement benefits P 500,000

Interest in a joint venture business P 3,000,000
House and lot, separate property of his wife P 2,000,000
Proceeds of insurance, revocably designated to wife P 1,500,000
Total P 7,000,000

Compute the amount to be included in gross estate?

a. P 2,000,000
b. P 3,500,000
c. P 4,500,000
d. P 7,000,000