Planit:Faraid and Estate Distributions Analysis Exercise Answer Key

Question One:

Nidal Dhakir and Rasha Nadhir are revising their will, and they want an estate analysis performed in order to see the distribution of the estate among the various beneficiaries in different scenarios. Nidal stated that he wants the maximum 1/3 of his estate to go to establishing a Waqf, and the remainder to be divided to his spouse and son according to faraid. Rasha did not have the same goals for establishing a Waqf, but identified that on her death her only relatives eligible to receive some of her estate were her husband, son, mother and father. There are no other surviving relatives for Nidal or Rasha. Based on this data and the faraid table below, complete the following chart measuring the Total Distribution for the various beneficiaries.

After producing the Estate Analysis preview, fill in the table below:

Answer:

Enter the data for the Partial Distribution and Residual Distribution sections on the Will Information screen.

1. For Nidal’s first partial distribution, enter 33.3% in the Percent field, leaving the Dollar Amount field blank. Change the Beneficiary setting to Charitable Donation – reflective of the Waqf.
2. For Nidal’s second partial distribution, 8.3% in the Percent field, leaving the Dollar Amount field blank. This is reflective of the 1/8 distribution to the wife multiplied by the remaining 2/3 of the estate after waqf. Put the Beneficiary as Spouse.
3. The Residual Distribution should be set the Child for the residual heir of their son.
4. For Rasha’s first partial distribution, enter 25% in the Percent field, leaving the Dollar Amount field blank. Change the Beneficiary setting to Surviving Spouse.
5. For Rasha’s second partial distribution, enter 33.3% in the Percent field, leaving the Dollar Amount field blank. This is reflective of the 1/6 distribution to the mother + the 1/6 distribution to the father. Since both the mother and father would be assigned as an “Other” Type beneficiary, grouping their distributions will result in the same calculations and Will Analysis.
6. The Residual Distribution should be set as the Child for the residual heir of their son.
7. Click Save

To View the Estate Analysis Report:

Click the Preview button at the bottom of the screen, OR

1. In the Your Working Documents screen, click on Preparing Reports – Risk Management.
2. Click on the Radio button beside Estate Analysis.
3. Click on the Generate Document link. It will usually take one minute to generate. You can either wait for it to appear in the Your Processed Documents window, or hit the Refresh button periodically until the completed document is ready for you to download.
4. Finally, when the document has completed calculating and is ready to view, click the Download button.

To identify the total distributions, scroll down to the last line called Total Distribution in the each section for the different scenarios. Follow the line until it meets the column titled Estate, Nidal or Rasha, Children, Charity and Other and record the numbers.