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Transfer of Interest in Property Held in Joint Tenancy
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…
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The Qualified Business Income Deduction – Part I
Good to Know The Section 199A deduction, popularly referred to as the 20% Qualified Business Income deduction, was enacted to reduce the disparity in income tax rates between C Corporations and “pass-through businesses.” There is no entity level income tax in pass-through businesses – business gains and losses “pass through” to the business owner’s personal…
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Internal Rate of Return Calculation
Course: Fundamentals of Financial PlanningLesson 5b: Using the HP 10bII Calculator Student Question: In Example 2, the solution given has 6 years (including CF0) instead of 5. I believe the first year of Carl’s coin purchase should be CF0, but the fifth year – which includes a purchase and a sale – should be CF4.…
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Actuarial Assumptions in Defined Benefit Contribution Plans
Which of the following statements concerning the various actuarial assumptions used in estimating an employer’s contributions to a Defined Benefit Pension Plan is correct? The higher the assumed rate of investment income, the larger the employer’s assumed contribution rate. The higher the employee turnover or termination rate, the larger should be the employer’s assumed contribution…
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2021 FINANCIAL PLANNING FORECAST
CFP® Certificants in the News According to a January 11, 2021, report by CFP Board, “…nearly 1 in 5 CFP® professionals reported that clients leaned on them as a financial therapist first and a financial planner second [in 2020]…”. Other key trends were reported by CFP Board, including: The rise of virtual financial planning “Advice…
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529 Plan Contribution Limits
Course: Fundamentals of Financial PlanningLesson 6: Educational Savings Techniques Student Question: Good morning, Do the limits on 529 Plan contributions apply to that specific account, the child, or the contributor? Is it possible for a contributor to have more than one 529 Plan if they’ve reached the limit on one? Thanks, Aaron Instructor Response: Hi…
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Modified Endowment Contract Loan
Alan paid $70,000 for a MEC policy when he was 50 years old. What are the income tax ramifications if he takes a $15,000 loan 3 years after purchasing the policy? The policy was worth $78,000 at the time of the loan. Alan would not have to report any taxable income or penalty. Alan would…
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ALERT – Tax Gift for 2020 PPP Borrowers
Good to Know In the cosmic order of U.S. tax law, expenses associated with tax-free income are frequently not deductible. In the case of Payroll Protection Program loans, the IRS went one step further to rule that expenses paid with the proceeds of PPP loan debt were not deductible if the loan was merely expected…
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Supply and Demand Impact on Prices
Course: Fundamentals of Financial PlanningLesson 2: Economic Concepts and Consumer Protection Laws Student Question: Hi, Can you please provide an explanation for the correlation between demand and the equilibrium price? I’m aware that demand is influenced by price increases or decreases; however, I’m having a hard time deciphering the relationship between demand and the equilibrium…
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