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Student Question of the Week: Income Tax
Student Question from: Amanda S.Course: Income Tax – Code Section 179 Student Question: Hi there! Can you explain more about the second bullet in the blue box (shown below) regarding the $560k excess and how it works? I think I understand the first scenario in the example: $560k – $139k allowed for immediate expense =…
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CFP® Practice Question of the Week: Sensitive Information
A CFP® professional observes that John and Barbara are constantly living a few steps ahead of their means. They assure the CFP® professional that they will reign in their spending, but their credit card balances continue to rise. All of the following are acceptable strategies EXCEPT: Terminate the relationship with the clients Document their inability to take…
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Student Question of the Week: Income Tax
Student Question from: John C.Course: Income Tax – Childcare Credit Student Question: I have a quick question about review exercise number 3 (below). It indicates that $2,100 would be the correct answer. I thought $6,000 was the maximum for two children? Are you perhaps asking for the minimum instead, or should we have assumed some…
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CFP® Practice Question of the Week: Tax Liability
Kevin’s non-qualified stock options are as follows: 2,000 shares: strike price $34 5,000 shares: strike price $30 Current stock price: $65 Kevin’s tax bracket: 42% (federal and state) Kevin has decided to exercise the above stock option awards, which will expire in the next 2 years. Assuming he exercises them today, what is his tax…
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Student Question of the Week: Income Tax – Gross Income Calculation
Student Question from: John C.Course: Income Tax – Gross Income Calculation Student Question: Hi. I just wanted to verify that the employee premium in the example below is not prorated between the “tax-free” and taxable insurance coverage. And, if it’s not, why? Here is my calculation: 5 x 4.5% + 7 *0.5 % = 26%…
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Student Question of the Week: Income Tax
Student Question: Student Question from: John C. Course: Income Tax Question: I had a quick question about taxpayer return penalties. In the Review Exercise below, I’m getting an answer of $780, but you all are showing an answer of $810. Why isn’t my math adding up? I’m counting 7 months for April to October. Here is…
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CFP® Practice Question of the Week: Investments
A young, single client approaches a CFP® professional with $5,000 stating that he would like to develop a financial plan and invest in the market. This is his first experience investing and he would like help choosing an appropriate account. What is the CFP® professional’s most appropriate course of action? A) Open a brokerage account with margin…
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Student Question of the Week: Fundamentals – Calculator
Student Question from: Susan M.Course: Fundamentals – Calculator Student Question: In example 3 (shown below), why do we use monthly instead of annual for the interest and period of time? Example 3: Bill wants to purchase enough life insurance to provide his family with an inflation-hedged income of $4,000 per month for 25 years. You…
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CFP® Practice Question of the Week: Transfer Tax
A client, Tom, informs a CFP® professional that his daughter, Susie, graduated from college last month and landed her first job. Tom wants to establish a Roth IRA for Susie. Tom wants to make a $5,000 contribution for Susie and explains that she does not know about investing and probably would not have the money…
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