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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Basis on Sale of Gifted Stock

Tom gave his son, David, a birthday present of Big M stock with a fair market value of $50,000. Tom paid gift tax of $11,700 as Tom had previously given David earlier this year a cash gift equal to the annual gift tax exclusion amount. Tom’s adjusted basis in the stock on the date of…

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Bi-weekly Refinance Payment Calculation

Mark refinanced his home mortgage to a 30-year fixed mortgage with biweekly payments. How much is each payment if he owed $410,000 at the time of the refinance and the interest rate is 7%? $1,021 $1,258 $1,521 $1,601 CLICK TO REVEAL ANSWER Expand B is the answer. Mark pays his mortgage every two weeks which…

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Actuarial Assumptions in Defined-Benefit Pension 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 rate.…

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Medicare Part A Expenses

Which of the following individuals currently covered by Medicare Part A will not have any of their expenses covered by Medicare Part A? Evan who spent one week in hospice care before losing his battle with cancer. Felicia who was treated by her doctor for Strep throat. Greg who was needed a walker following hip…

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Like-Kind Exchange

William found someone to buy his rental property in Maine. Which of the following properties that William would like to purchase as rental property would allow him to complete a like-kind exchange? A golf course rental property in Arizona that William identified 30 days after selling his Maine property. A beach rental house at the…

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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 bonds…

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Refinance Payment Calculation

Jim refinanced his home mortgage to a 30-year fixed mortgage with biweekly payments. How much is each payment if he owed $450,000 at the time of the refinance and the interest rate is 6%? $923 $1,244 $1,412 $2,592 CLICK TO REVEAL ANSWER Expand B is the answer. Brandon pays his mortgage every two weeks which…

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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…

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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…

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