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Means Test (Bankruptcy)
Course: Fundamentals of Financial PlanningLesson 4: Managing Cash Flow and Debt Student Question: I’m making sure I understand the means test. If the person is trying to file Section 7 to get rid of debt but the means test shows they can cover their allowable expense, will they be forced to file Section 13 and have to do a repayment plan? It appears the means test is…
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Carryover of Losses
The following information has been provided by a client for income tax purposes: $45,000 salary from an S Corporation where the client is a vice-president $3,500 loss from the S Corporation $1,500 loss from a 3% interest in a limited partnership $1,200 loss from a 10% interest in Middletown Partnership in which the client does…
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CFP® Certificants in the News: Free CFP Board Practice Exam
CFP Board Exam Registrants – Be sure to take CFP Board’s Practice Exam What could be better for exam preparation than taking a full six-hour, timed practice exam offered by the CFP Board? Receiving this resource free is better! The cost of CFP Board’s full, 170-question practice exam is normally $249. If you registered to…
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Solving for Annual Equivalent Rate
Course: Fundamentals of Financial PlanningLesson 5: Using the Calculator Student Question: I am confused as to how to get the correct answer for question number 4. Jackie invests her bonus at the beginning of this calendar year. If she earns 7% compounded monthly, what is the annual equivalent rate? Round your answer to two decimal places. I solve for the future value…
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Tax Saving Strategies
Dan and Karen Burles have 2 children, Coy (age 12, student) and Roger (age 21, student). Dan and Karen own a security equipment sales and installation business – an LLC. Dan and Karen are in the highest income tax bracket. They have a portfolio with $130,000 of municipal bonds (annual income $5,200), $80,000 of corporate…
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Good to Know: Is The Stretch IRA Dead?
It’s been reported that the Stretch IRA is dead for eternity (or at least until Congress changes the rules again). A Stretch IRA, of course, is the strategy of delaying required minimum distributions from an inherited IRA for decades if not generations. Before the SECURE Act of 2019, the Stretch IRA strategy was highly effective…
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High Deductible Health Plan Deductible and Out-of-Pocket
Course: Income Tax PlanningLesson 7: Arriving at Adjusted Gross Income Student Question: Regarding the minimum deductible and maximum out-of-pocket limits for a high deductible health plan, could you explain more clearly “The minimum deductible must be at least $1,400 (single) or $2,800 (family)“. Does that mean, if single, an individual will pay at least $1,400 per doctor visit/procedure, but no more than the maximum out-of-pocket…
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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 her…
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CFP® Certificants in the News: Where Will Tomorrow’s CFP® Certificants Come From?
CFP Board Center for Financial Planning – Workforce Development Initiative CFP Board reports1 a “growing number of financial planners [will] retire” and sounds the alarm to avoid a “shortage of CFP® professionals to serve the increasing demand of the public.” One of the ways CFP Board is “building the talent pipeline” is through the Financial…
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