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Student Question of the Week: 3.8% Medicare Surtax
Student Question from Leslie GCourse: Fundamentals of Insurance Planning Student Question: Hi Dan, I’m confused on how I would know whether or not to apply the 3.8% Medicare surtax in the following CFP Board released question. How can I know without knowing their AGI? Your client’s federal marginal tax rate is 35% and the state…
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Student Question of the Week: Isn’t an IRA a Qualified Plan?
Student Question: Hi Dan! I think I’m confused on my terminology. I always thought non-qualified plans were: SERP’s, Executive Deferred Comp., 457 Plans, etc. But in Lesson 1 of the Retirement Planning section, I see that IRA’s, SEP’s, 403(b)’s are considered “non-qualified plans.” Am I mixed up about this? Instructor Response: Hi Margie! I hope…
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Student Question of the Week: FDIC versus SIPC
Student Question from Leslie GCourse: Fundamentals of Financial Planning Student Question: I thought that all investments were SIPC covered; however, does that change for an IRA invested in a money market fund or CDs? Thanks! Instructor Response: Hi Leslie! The purpose of the FDIC is solely to provide consumer confidence in our nation’s banking system.…
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CFP® Practice Question: Disadvantages of Universal Life Insurance
Which of the following statements concerning the disadvantages of universal life insurance is (are) correct? (1) The future yield potential for the policy owner is uncertain. (2) The semi-compulsory regular savings feature of conventional whole life insurance is lost. (3) Since the cash value is invested primarily in common stocks and other equities, it is…
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CFP® News: CFP Board Changing Exam-Taking Procedure
The CFP Board has announced that starting in November 2014, the national Board Exam will be computerized and shortened to 6 hours. The current exam is given over a two-day period, totaling 10 hours, and on a scantron. An ongoing concern of the CFP Board has been the number of students in Approved Educational Programs…
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Student Question of the Week: Prorate Section 2032A Recapture?
Student Question from Greg CCourse: Income Tax Planning Student Question: Is the recapture full or is it prorated? I looked at Section 2032A and couldn’t quickly tell although it does not appear to be prorated. That is a complex Code section and the slide appears to do a nice job of distilling it down to…
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CFP® Practice Question: Including Short-Term Disability in Gross Income
Bob broke his leg skiing earlier this year. Bob collected $10,000 from his short-term disability plan, paid for solely by his employer. How much does Bob have to include in his gross income? A. $0 B. $5,000 C. $8,500 D. $10,000 CLICK TO REVEAL ANSWER The correct answer is D. Bob must include 100% of…
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Surprises from the November 2013 CFP® Certification Exam
Four Surprises to be Aware Of: Psychological Warfare First 10 questions of the 1st exam session were complex to very complex calculations At least one had NO correct answer! Forewarned is forearmed Calculator proficiency is becoming important once again Disproportionate Practice Standards Testing Concepts versus minutiae Extreme focus in one topical area
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Student Question of the Week: Property Ownership
Student Question from EtebeCourse: Estate Planning Student Question: Good evening, #7 on the review question…why would four business associates with equal partnership be tenants in common? I thought it would be JTWROS as their interest is equal and undivided. Thanks. 7. An investment by four business associates, each wishing to contribute 25% of the purchase price. 100%…
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