Paralegal Advanced Competency Exam (PACE) Practice Exam

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Prepare for the Paralegal Advanced Competency Exam (PACE) with our comprehensive quiz. Designed for aspiring paralegals, this exam will help you assess your readiness with flashcards and multiple-choice questions, complete with hints and explanations.

Each practice test/flash card set has 50 randomly selected questions from a bank of over 500. You'll get a new set of questions each time!

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What does a direct skip refer to in legal terms?

Transfer of assets to a charity
Transfer of property that skips a generation
Immediate inheritance after death
Transfer of assets to a spouse

The correct answer is: Transfer of property that skips a generation

A direct skip refers to the transfer of property or assets directly to a person who is two or more generations younger than the transferor, thereby skipping the intermediate generation. This is often relevant in estate planning and taxation, particularly when considering the Generation-Skipping Transfer Tax (GSTT), which is designed to impose taxes on certain transfers that bypass generations. For example, this could occur when a grandparent leaves an inheritance directly to a grandchild without allocating assets to the parent (the intermediate generation). The other options present different types of asset transfers that do not specifically embody the concept of skipping a generation in the same way. Marketing transfers to a charity or a spouse do not involve skipping a generation, while immediate inheritance after death pertains to the timing of the transfer rather than the generational aspect of the transfer.