Posts by Dan Madden, CFP®

Which of the following individuals need to register with the SEC under the Investment Advisers Act of 1940? Adam who retired last year from a big brokerage house but he recently started providing services to 12 clients who live in his neighborhood that he met while out golfing. Belinda who writes weekly investment articles for…

An investor bought a bond at par that matures in 15 years. The bond pays an annual coupon of $120 and the reinvestment rate is 7%. What is the realized compound yield of this bond? 8.01% 9.71% 11.00% 12.10% CLICK TO REVEAL ANSWER Expand B is the answer. One would anticipate a realized compound yield…

Which of the following trusts should Jason establish in his Will to provide for his son Gaven’s living expenses until Gaven reaches age 65 if Gaven is currently a 30-year old unemployed aspiring actor? 2503(b) trust 2503(c) trust Crummey trust Totten trust CLICK TO REVEAL ANSWER Expand A is the answer.  The 2503(b) trust would…

April’s husband Jay died 5 years ago when their home was worth $600,000. Due to the soft real estate market, April kept the house until the housing market recovered. She finally sold the home this year for $950,000. What is the amount of April’s taxable gain or loss if she bought the home jointly with…

Gary Chapelle owns a duplex with his brother in joint tenancy with right of survivorship. Gary would like to pass his interest in the property to his son, Bill, and Gary has provided in his will that his interest in the duplex will pass to Bill. Which of the following statements concerning the transfer of…

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…