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CFP Board Updates: July CFP® Exam Update
Those taking the July CFP® exam are well-served by understanding the new Medicare taxes. The 3.8% Medicare tax on unearned income and the .9% Medicare tax on wages and self-employment income are likely to be tested on the July Exam. The good news is that the Board is expected to provide the adjusted gross income…
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CFP® Practice Question: Financial Planning Process
THIS QUESTION BROUGHT TO YOU BY: KEIR EDUCATION RESOURCES To learn more about Keir’s CFP Board Exam review materials and classes, select the program you’re registered in below: During the stage of the financial planning process requiring processing and analyzing information, the financial planner will undertake all the following actions, EXCEPT: Evaluate current economic conditions relating…
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Student Question of the Week: Correctly Entering a Positive or Negative Cash Flow
Student Question from: Jessica W.Course: Fundamentals – Calculator Student Question: I am getting confused on when the PV should be entered as a negative or positive number for these calculator problems. If I enter it the wrong way (negative when needs to be positive) I am getting the incorrect answer. Thanks! Instructor Response: This is…
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CFP® Practice Question: Understanding Portability
In giving a talk to a small audience on the topic of estate planning, someone asks you, as a financial planner, to provide some clarifying comments regarding the recent portability of the Applicable Exclusion Amount between spouses. You would be correct in making any of the following comments EXCEPT: While the 2012 Tax Relief Act…
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Student Question of the Week: Adjusted Basis in Property – An Example
Student Question from: Susan M.Course: Income Tax Student Question: On Question 2 – Why are we adding the $2,500 security in as a capital addition when it does not lengthen the life of the building? By definition, doesn’t it have to extend the life of the asset by at least 1 year? 2. Madden Incorporated…
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Good to Know: CFP® Practitioner Updates
A financial planner’s work is never done. The administration’s proposed 2014 budget takes aim squarely at the “permanent” estate tax reforms passed in January 2013. The current $5,250,000 estate tax exemption would plummet $1,750,000 to only $3,500,000. The estate tax rate would jump to 45% from the current 40%. But that’s not all. The proposal…
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Student Question of the Week: 529 Contributions – Can I Contribute Stock?
Student Question from: Vincent C.Course: Fundamentals – Education Planning Student Question: For the basic rule of only using cash contributions for 529 Plans, can you roll over appreciated stocks from UTMA/UGMA and ESA? If so, do you have any taxable event tied to the rollover of stocks (if an unrealized gain exists)? Instructor Response: Hi…
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Student Question of the Week: Grantor Trusts – What are They Good For?
Student Question from: Harry F.Course: Estate Planning Student Question: Dan, given the information on this page, why do Grantor Trusts exist? What purpose do they serve? Grantor Trusts A Grantor Trust is a trust in which the grantor, due to retained control over the income and/or corpus of the trust, is treated as the owner of…
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Student Question of the Week: Basis in Property Transactions
Student Question from: Katy U.Course: Income Tax Student Question: On the adjusted basis portion in the question below – why is the $25,000 not included? Isn’t that a commission? I thought you are supposed to include the commission or other similar costs. Nick purchased an office building in Year 1 for $150,000 and sold it…
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