Good to Know Taxpayers may reduce their 2020 taxable income by tens of thousands of dollars by contributing to tax-deductible IRAs, 401(k)s, and other accounts by May 17, 2021. Traditional Deductible IRA Contributions Taxpayers who are unaware of this opportunity or miss the usual April 15, 2021, deadline may contribute to an IRA for 2020…

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Course: Income Tax PlanningLesson 10: Recognition of Expenses, Losses, and Deductions Student Question: Question 5 (below) did not make sense to me. I started out by breaking down by year:   400,000 / 2,100,000 * 3,000,000 and so forth but did not arrive at the correct answer.  So, then I tried adding up 3 year: 400 +…

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Course: Insurance PlanningLesson 6: Commercial Property and Liability Insurance Student Question: Can you please provide an example of contingent business interruption and extra expense insurance? Thanks, Laura Instructor Response: Hi Laura, Good question.  Here’s how contingent business interruption insurance might apply.  You own a nationwide chain of jewelry stores that specialize in gold/palladium alloys.  Your…

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Good to Know In mid-March, the IRS announced an extension of time to file individual 2020 income tax returns. The following excerpts were taken directly from IRS press release IR-2021-59, March 17, 2021: “WASHINGTON — The Treasury Department and Internal Revenue Service announced today that the federal income tax filing due date for individuals [including…

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Course: Insurance PlanningLesson 10: Social Security Student Question: Does the maximum family benefit apply to a husband and wife that are both fully insured if the combined total between the two exceeds the maximum family limit?   If I understand correctly, the maximum family limit only applies if there are beneficiaries within the family receiving benefits…

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CFP® Certificants in the News CFP Board press release, December 16, 2020 Relying on extensive consumer research and user testing, Certified Financial Planner Board of Standards, Inc. (CFP Board) recently launched its redesigned and updated consumer-facing website, LetsMakeAPlan.org (LMAP). The refreshed website includes updated content and a modernized interface with a mobile-friendly design to improve user experience,…

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Course: Insurance PlanningLesson 16: The Irrevocable Life Insurance Trust Student Question: Must Crummey Powers always be in effect to apply the annual gift tax exclusion in order to transfer to an irrevocable trust? Or is it the case that as long as it was done once, will all transfers be eligible for the annual gift tax exclusion? Thanks,…

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Good to Know Alert-As of the date this blog was written (March 16, 2021) pressure was building to extend 2020 tax return due dates in recognition of COVID challenges. However, taxpayers should assume the due date for personal and business income tax returns remains unchanged unless an official IRS pronouncement indicates otherwise. The IRS recognizes…

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Course: Estate PlanningLesson 13: Case Study Online Student Question: I am a little confused how one set amount – $100 – is the threshold for means testing a bankruptcy petitioner when the amount of debt a borrower may owe can vary by large amounts. It would seem the amount left over (income minus allowable expenses)…

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Course: Estate PlanningLesson 13: Case Study Online Student Question: If a check given by Mary to Peter was deposited into a custodial account where Mary was the custodian, doesn’t that mean that Mary didn’t give up ALL control, so it’s not a completed gift? Thanks, Megan Instructor Response: Hi Megan, That’s a great way to…

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