Taxable and Exempt Transfers

Taxable transfers (with insufficient consideration or without consideration)

  1. Transfers in contemplation of death.
  2. Revocable transfers.
  3. Properties passing under a general power of appointment.

Exempt transfers

  1. The merger of usufruct in the owner of the naked title.
  2. The transmission or delivery of the inheritance or legacy by the fiduciary heir or legatee to the fideicommissary.
  3. The transmission from the first heir, legatee, or donee in favor of another beneficiary, in accordance with the desire of the predecessor.
  4. All bequests, devises, legacies or transfers to social welfare, cultural and charitable institutions, no part of net income of which inures to the benefit of any individual: Provided, however, that not more than 30% of the said bequests, devises, legacies or transfers shall be used by such institutions for administration purposes.

Properties EXCLUDED from gross estate of citizen or resident alien decedent

  1. Proceeds of irrevocable life insurance policy payable to beneficiary other than the estate, executor or administrator.
  2. Proceeds of GSIS policy.
  3. Separate property of the surviving spouse.
  4. Benefits received from GSIS.
  5. Benefits received from SSS.

Questions to Answer:

  1. Which of the following is not included in the gross estate?

A. Revocable transfer where the consideration is not sufficient.

B. Revocable transfer where the power of revocation was not exercised.

C. Proceeds of life insurance where the beneficiary designated is the estate and                               the designation is irrevocable.

D. Proceeds of life insurance where the beneficiary designated is the mother                                 and the designation is irrevocable.

2. Proceeds of life insurance includible in the taxable gross estate

A. Insurance proceeds from SSS or GSIS

B. Amount payable to any beneficiary, irrevocable, designated in the insurance                               policy by the insured

C. Amount payable to any beneficiary designated in the insurance policy by                                      the insured.

D. Proceeds of group insurance taken out by a company for its employees.

For the correct answers,  I would like to invite you to join my exclusive groups of aspiring CPAs for my upcoming project “CPA Dream Academy”.CPA DREAM ACADEMY

CPA Mentor,

JONATHAN RUIZ CPA, MIB

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About PAM Academy Founder

Newbie Mentor and one of the influential author in the Philippines setting. His also the founder of PAM Academy and Developer of PAM PSE TRACKER application.
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