Bruce Starks, CPA, CFP® – Page 16

Unused Premium

Course: Insurance PlanningLesson 8: Gift and Estate Valuation Student Question: Could you please clarify for me what the unused premium would be in term life insurance? I don’t quite understand how you could not use the premium. Thanks. Instructor Response: Certainly. A lot of different terms in insurance, to be sure. Assume you pay $6,000…

Calculating Late Filing/Paying Penalties

Course: Income Tax PlanningLesson 1: Introduction to Taxation Student Question: For this question, could you send me the math behind finding the answer? I want a better understanding of how the penalty was assessed. Review Exercise: Jerry’s taxes were due April 15th. He filed his return in October of the same year, and paid his…

Executive Compensation—Restricted Stock

Good to Know All that glitters is not gold. -French Monk Alain de Lille, 1175 Assume your client just received a grant of Restricted Stock from their employer. Congratulations are in order, but before they go out and use some of that grant “money” to celebrate, let’s understand exactly what they received and when they…

Real Estate Income and IRA Contributions

Course: Retirement PlanningLesson 1: Using IRAs to Build and Distribute More Retirement Income Student Question: This page states that rental income is not included in the definition of earned income. If the client is a professional real estate developer whose income is derived mainly from rental income, would they be able to contribute to an…

Premium Payments on Buy-Sell Agreements

Course: Insurance PlanningLesson 17: Business Uses of Life and Disability Insurance Student Question: I have a quick question regarding buy/sell agreement; not clear who would pay the premiums on disability and or life insurance on the principals and the key employees? Instructor Response: Great question. A buy-sell agreement relates to owners of the business while…

Advanced Roth Strategies—Part II of II

Good to Know This article continues our goal to create or deepen a financial advisor’s awareness of the creative use of Roth IRAs or Designated Roth Accounts in special circumstances such as: Resolving the tension between building an emergency reserve and saving for retirement, Reducing income taxes on Social Security Benefits for retirees, and Lowering…

Distributable Net Income Application

Course: Estate PlanningLesson 9: Income Taxation of Trusts and Estates Student Question: Hi Bruce When a Trust has an income accumulation year, must the Trust pay taxes on that accumulation of DNI in the year of accumulation? If so, why do that – why would a Trust hold income at the confiscatory Trust income tax…

Results From March CFP Board Exam

CFP® Certificants in the News The results are in. We saw a continuation of existing trends and at least one surprise from the results of the March 2023 CFP Board Exam, including: Number of examinees taking the exam, Primary reason for taking the exam, Employer-provided financial support. Number of Examinees Taking the Exam An impressive…

Home Mortgage Interest Deduction

Course: Income Tax PlanningLesson 8: Arriving at Taxable Income Student Question: If a client has a $250k mortgage on a home worth $500k and they refinance to take equity out of their home, say $100k. Then they use that $100k to purchase a vacation home worth $300k (so they now have $450k in mortgage debt),…

Advanced Roth Strategies—Part I of II

Good to Know This article is intended to create or deepen a financial advisor’s awareness of the creative use of Roth IRAs or Designated Roth Accounts in special circumstances such as: Business Owners with Net Operating Losses and High-Income Clients that are ineligible for a Roth IRA contribution. Caveat—this article is meant to raise awareness…