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Various Sources of Income
A client received an annual salary from his employment of $40,000. He was a 50% owner of both a C corporation and an S corporation. The C corporation had net profits of $20,000, and the S corporation had income of $10,000. Neither corporation made a distribution. The client’s revocable trust had income of $5,000 but…
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How Safe is Your Client’s Cash?
CFP® Certificants in the News CFP Board expects certificants to understand “safe haven investments” of cash. A safe haven in this context is an account with a low default risk, as in bank deposits guaranteed by the Federal Deposit Insurance Corporation (FDIC). You may have heard that cash deposited into a federally chartered bank is…
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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…
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Appropriate Valuation Method
Sam McBuck has an estate of $10 million and would like to leave it to his nephews. Sam assumes he will live for at least 5 more years. The property in Sam’s estate currently includes the following assets: An apartment building in downtown New York that Sam owns with three partners, each of whom wants…
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How Have You Planned for Healthcare Expenses?
Good to Know How will you cover your retirement healthcare costs if you retire before age 65? There may be more options than you think! Over the next few weeks, the author will highlight key alternatives for retirees too young to qualify for Medicare. This article, Part 1 of a series, will highlight the pros…
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Donating Short-term Appreciated Securities
Course: Income Tax PlanningLesson 15: Property Transactions Student Question: In the lesson, deducting donations of ‘cash’ versus ‘long term appreciated securities’ are differentiated. I’m curious about “short term appreciated securities”. In other words, if I own a stock – bought at $10,000 and it’s worth $50,000 when I donate, but I’ve only owned it 6…
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Reducing the AMT
Which of the following tax planning ideas would help Beth the most if she currently has to pay AMT taxes? Pay her $1,000 January mortgage payment before the end of the year. Pay her $2,000 January alimony payment to her ex-husband before the end of the year. Recognize a $3,000 short term capital gain on…
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CFP Board Announces Elizabeth Miller as 2024 CFP Board Chair-Elect
CFP® Board Updates In July, the CFP Board announced Elizabeth Miller, CFP® as its 2024 Chair-elect. She has previous experience with the CFP Board as a Board Director in 2020 and is a member of CFP Board Center for Financial Planning’s Campaign Development. Liz Miller, CFP®, CFA®, is the founder and President of Summit Place…
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Passing Property Via Will
Course: Investment PlanningLesson 14: Evaluation Portfolio Performance Student Question: Hello – I’m a little confused about the example (below) discussing an heirloom of only sentimental value. Why would this be titled at all for a will, especially since an earlier lecture said items of no value would pass through will as the situation does not…
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