Questions of the Week

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? Thanks,…

Course: Estate PlanningLesson 13: Case Study Online Student Question: I am a little confused how one set amount – $100 – is the threshold for means testing a bankruptcy petitioner when the amount of debt a borrower may owe can vary by large amounts. It would seem the amount left over (income minus allowable expenses)…

Course: Estate PlanningLesson 13: Case Study Online Student Question: If a check given by Mary to Peter was deposited into a custodial account where Mary was the custodian, doesn’t that mean that Mary didn’t give up ALL control, so it’s not a completed gift? Thanks, Megan Instructor Response: Hi Megan, That’s a great way to…

Course: Income Tax PlanningLesson 6: Employer-Sponsored Total Income Exclusions Student Question: For “No Additional Cost Services” provided by an employer, which are excluded from employee income, there is the requirement that no significant costs are incurred.  How is “significant” cost determined? Significant sounds subjective. Is there a general rule for determining what is considered significant?…

Course: Fundamentals of Financial PlanningLesson 6: Educational Savings Techniques Student Question: Good afternoon – What happens if a parent has contributed to a prepaid tuition plan, but the child decides not to attend that school? Also, do contributions pertain to just one school? Or is it any school within that state? Kind regards, Austin Instructor…

Course: Fundamentals of Financial PlanningLesson 5: Using the Calculator Student Question: Good afternoon.  Can you explain why we didn’t take inflation into consideration for the second calculation in the first problem? Dawn wants to have $25,000 in today’s dollars for a round-the-world cruise when she retires 11 years from now. She assumes she can earn…

Course: Income Tax PlanningLesson 1: Introduction to Taxation Student Question: For this question, could you send me the math behind finding the answer?  I want a better understanding of how the penalty was assessed. Review Exercise: Jerry’s taxes were due April 15th. He filed his return in October of the same year and paid his…

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.…

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…

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…