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Practice and exam technique

Practice questions: estate planning

Compiled by the Sitonce editorial team from CFP Board sources listed belowUpdated 4 min readFacts verified 1 September 2026
The short answer

Estate planning is 10 per cent of the exam. These five cover titling overriding the will, incidents of ownership, portability, the qualified disclaimer and choosing between a QTIP and an outright transfer.

Estate questions reward knowing what controls what. Several of these turn on that alone.

Question 1

A client's will leaves everything to her children. Her retirement account names her ex-husband as beneficiary, from before the divorce. She dies. Who receives the retirement account?

  1. The children, under the will
  2. The ex-husband, under the beneficiary designation
  3. The estate, because the designation is void on divorce
  4. The children, because a will overrides a designation
Answer: B. A beneficiary designation controls the asset regardless of the will. Some state statutes revoke designations on divorce and federal law can preempt them for plans governed by ERISA, which is why the answer is not simply reversed by the divorce. It is the most common and most avoidable estate planning failure there is.
Question 2

A client owns a USD 2,000,000 life insurance policy on his own life, payable to his daughter. What is included in his gross estate?

  1. Nothing - the death benefit is income tax free
  2. The cash value only
  3. The full USD 2,000,000 death benefit
  4. Nothing, because the beneficiary is not the estate
Answer: C. Income tax free and estate tax free are different things. The full death benefit is in the gross estate where the decedent held incidents of ownership, which owning the policy plainly does. An irrevocable life insurance trust owning the policy from the outset is what prevents it.
Question 3

A husband dies with a taxable estate well below the exclusion. His executor does not file a federal estate tax return. What has been lost?

  1. Nothing - no return was required
  2. The step-up in basis on his assets
  3. The ability to elect portability of his unused exclusion
  4. The marital deduction
Answer: C. Portability requires a federal estate tax return to be filed to elect it, even where no return would otherwise be required and no tax is due. Advising the executor to file is one of the most valuable things a planner does in the year after a death, and missing it forfeits the exclusion permanently.
Question 4

A wealthy client dies leaving everything outright to his spouse. She has ample assets of her own and wants some of it to go to the children instead. What is available?

  1. She can rewrite his will
  2. She can make a qualified disclaimer within nine months, before accepting any benefit
  3. She can direct the executor to distribute to the children
  4. Nothing - the transfer is complete
Answer: B. A qualified disclaimer must be in writing, irrevocable, made within nine months, before accepting any benefit, and without directing where the property goes. The property then passes as though she had predeceased - to whoever the will names next, which she cannot choose.
Question 5

A client in a second marriage wants to provide income for his current spouse for life, with the remainder passing to children from his first marriage. Which structure fits?

  1. An outright transfer to the spouse, relying on her will
  2. A QTIP trust with the QTIP election made
  3. A charitable remainder trust
  4. A revocable trust naming the children as successor beneficiaries
Answer: B. A QTIP pays all income to the surviving spouse for life and qualifies for the marital deduction on election, while the first spouse controls who receives the remainder. An outright transfer relies on the survivor's goodwill, which is exactly what the client is trying not to do.

What runs through all five

Control. Who controls the asset, who controls the remainder, and who controls the election.

Estate planning questions almost always turn on that, which is a more useful reading habit than trying to recall the technique names.

Figures are for the 2026 tax year

Dollar limits and thresholds are indexed annually. Confirm current figures before relying on them; the exam tests the rule rather than the number.

Common questions

Does a will override a beneficiary designation?

No. The designation controls the asset. Some state statutes revoke designations on divorce and federal law can preempt them for ERISA plans, which is why the outcome is not simply reversed by a divorce.

Is life insurance in the taxable estate?

The full death benefit is, where the decedent held incidents of ownership such as owning the policy. Income tax free and estate tax free are different things.

What is lost by not filing an estate tax return?

The ability to elect portability of the deceased spouse's unused exclusion. It must be elected on a return even where none would otherwise be required.

Can a surviving spouse redirect an inheritance?

Only by qualified disclaimer - in writing, irrevocable, within nine months, before accepting any benefit, and without directing where it goes. It then passes as though she had predeceased.

What suits a second marriage with children from a first?

A QTIP trust. It pays income to the surviving spouse for life and qualifies for the marital deduction on election, while the first spouse controls the remainder.

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