Owner of a Grantor Trust

In which of the following situations would the grantor of a trust not be considered the owner? The grantor has a reversionary interest in the trust, of which the grantor’s son is the sole beneficiary, but the grantor cannot exercise this power until eight years after transfer of property to the trust. The grantor retains…

Read More

Basis on Sale of Gifted Stock

Tom gave his son, David, a birthday present of Big M stock with a fair market value of $50,000. Tom paid gift tax of $11,700 as Tom had previously given David earlier this year a cash gift equal to the annual gift tax exclusion amount. Tom’s adjusted basis in the stock on the date of…

Read More

“Per Capita” Fee for CFP Board Exam Takers Begins January 1

CFP® Board Updates Students of our CFP Certification Education Programs are aware, but this may serve as a reminder, the CFP Board will begin charging the $195 “Per Capita” fee on January 1, 2023. What is the Per Capita Fee? When a student completes this program, we report it to the CFP Board, and the…

Read More

Medicare Part A Expenses

Which of the following individuals currently covered by Medicare Part A will not have any of their expenses covered by Medicare Part A? Evan who spent one week in hospice care before losing his battle with cancer. Felicia who was treated by her doctor for Strep throat. Greg who was needed a walker following hip…

Read More

Possible Penalties on Tax Return

Terry received a notice from the IRS correcting a math error on his individual income tax return. As a  result, Terry owes $1,000 in taxes,   penalties and interest. Which of the following is the most likely penalty or interest assessed against Terry? Understatement penalty Failure to file penalty Fraud penalty Underpayment penalty CLICK TO REVEAL ANSWER Expand D is the answer.…

Read More

Annual Return and Compounding

Course: Fundamentals of Financial PlanningLesson 5: Using the Calculator Student Question: My question relates to being able to clearly distinguish when the CFP Board exam will require an annual, or other period for the answer. Question 5(b) asks: “What is the rate of return on Investment 2 using daily compounding?” What is the annual rate…

Read More

Using Jensen Performance Index

Based on the Jensen performance index, which fund should the investor continue to hold given the following information? Fund 1 Fund 2 Return on Portfolio 13% 17% Beta .95 1.02 Standard Deviation .18 .22 Risk free rate of return is 7% Market return is 15% Fund 1 Fund 2 Both Fund 1 and 2 Neither…

Read More

Like-Kind Exchange

William found someone to buy his rental property in Maine. Which of the following properties that William would like to purchase as rental property would allow him to complete a like-kind exchange? A golf course rental property in Arizona that William identified 30 days after selling his Maine property. A beach rental house at the…

Read More

CFP Board Announces 2022 Academic Research Colloquium Conference

CFP® Board Updates The CFP Board and the Center for Financial Planning have announced the dates for the 2022 Academic Research Colloquium for Financial Planning.  The conference will be held at the Conrad Washington, DC on October 24th and 25th, 2022. The Colloquium, which is an initiative of the Center for Financial Planning, is a…

Read More

Refinance Payment Calculation

Dale refinanced his home mortgage to a 30 year fixed mortgage with biweekly payments. How much is each payment if he owed $350,000 at the time of the refinance and the interest rate is 3%? $680 $771 $1,136 $1,242 CLICK TO REVEAL ANSWER Expand A is the answer. Brandon pays his mortgage every two weeks…

Read More