Skip to Main Content
GiftLaw Pro
Charitable Giving & Tax Information Service
Back to Gift Planning Website
GiftLaw Pro Home   >  Chapter 3 - Deferred Gifts  >  3.7 Life Estate Reserved  >  3.7.1 Personal Residence or Farm  >  Basic Quiz

Basic Quiz - 3.7.1 Personal Residence or Farm

1. A donor who owns her home outright may not receive a charitable income tax deduction for the transfer of a remainder interest in her residence.
           
2. For life estate arrangements, the lower the applicable federal rate (AFR), the higher the charitable tax deduction.
           
3. The gift of a remainder interest is accomplished by the creation of a trust and the transfer of a deed into that trust.
           
4. A personal residence is defined as one's residence that is owned and occupied by the owner in two of the past five years.
           
5. The term "farm" is defined as property used for production of crops or raising live stock.
           
6. A gift of a remainder interest in a home or farm by an individual under the age of 35 will fail to qualify for a charitable income tax deduction because of the 10% minimum deduction interest test.
           
7. Pursuant to the partial interest rules, a gift of a remainder interest to charity must be the entire remainder interest.
           
8. The reservation of a life estate can be made only for the donor or only for the donor and the donor's spouse.
           
9. A donor may retain a term of years instead of a life estate in a home or farm.
           
10. A gift of a remainder interest in a home or farm is permitted only for those donors over age 35.