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Basis on Sale of Gifted Stock
Which of the following individuals would typically qualify for accelerated death benefits under their term life insurance policy? Ida who is expected to die within 7 months from cancer. Jacob who is expected to die within 10 months from AIDS. Kay who is expected to die within 3 months from kidney failure. All of the…
CFP Board Announces 2023 Academic Research Colloquium Winners
CFP® Board Updates The CFP Board Center for Financial Planning held the 7th annual Academic Research Colloquium for financial planning and related disciplines. It was held December 7-8, 2023 at the Renaissance Arlington Capital View Hotel in Arlington, VA. The colloquium is an international meeting of researchers, practitioners, graduate students and leaders of the financial…
Vested versus Contingent Beneficiary
Course: Estate PlanningLesson 3: Understanding Trusts and Trust Documents Student Question: In the example, I would think Northwestern would have a future, contingent interest, as their interest is dependent upon the death of the wife. But the feedback tells me it’s a vested interest. Do we assume death is inevitable, and therefore not a contingent-worthy…
Reversion Tax
Lucky Star Corp has been extremely lucky with their defined benefit plan as it is currently overfunded. Management decided to terminate the plan while they are overfunded and share the excess with the employees. What amount of reversion tax will Lucky Star Corp have to pay upon termination? 0% 10% 20% 50% CLICK TO REVEAL…
Artificial Intelligence in Insurance
Good to Know The promise of AI must be tempered by the responsibility for its use by insurance companies according to a guidance bulletin published December 4 by the National Association of Insurance Commissioners (NAIC). According NAIC Commissioner Birrane, “This initiative represents a collaborative effort to set clear expectations for state Departments of Insurance regarding…
Risk Premium versus Intrinsic Value
Course: Investment PlanningLesson 5: Fundamental Equity Analysis Student Question: The first review exercise page in Lesson 5, is Intrinsic Value the same as Risk Premium? Is that why we’re solving for P0 and not V (which is given)? The formula provided in the explanation confuses me. (question and answer from review exercise below) Review Exercise Question: Current price…
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…
Crummey Powers
Course: Insurance PlanningLesson 16: The Irrevocable Life Insurance Trust Student Question: Must Crummey powers always be in effect to apply the annual gift tax exclusion in order to transfer to an irrevocable trust? Or is it the case that as long as it was done once, will all transfers be eligible for the annual gift tax exclusion? Instructor…
Accelerated Death Benefits
Which of the following individuals would typically qualify for accelerated death benefits under their term life insurance policy? Ida who is expected to die within 7 months from cancer. Jacob who is expected to die within 10 months from AIDS. Kay who is expected to die within 3 months from kidney failure All of the…