Student Question

Course: Retirement PlanningLesson 1: Using IRAs to Build and Distribute More Retirement Income Student Question: This page states that rental income is not included in the definition of earned income.  If the client is a professional real estate developer whose income is derived mainly from rental income, would they be able to contribute to an…

Course: Income Tax PlanningLesson 15: Property Transactions Student Question: In the lesson, deducting donations of ‘cash’ versus ‘long term appreciated securities’ are differentiated.  I’m curious about “short term appreciated securities”.  In other words, if I own a stock – bought at $10,000 and it’s worth $50,000 when I donate, but I’ve only owned it 6…

Course: Investment PlanningLesson 14: Evaluation Portfolio Performance Student Question: Hello – I’m a little confused about the example (below) discussing an heirloom of only sentimental value. Why would this be titled at all for a will, especially since an earlier lecture said items of no value would pass through will as the situation does not…

Course: Income Tax PlanningLesson 15: Property Transactions Student Question: In the lesson, deducting donations of ‘cash’ versus ‘long term appreciated securities’ are differentiated.  I’m curious about “short term appreciated securities”.  In other words, if I own a stock – bought at $10,000 and it’s worth $50,000 when I donate, but I’ve only owned it 6…

Course: Insurance PlanningLesson 15: Income Taxation of Life Insurance Student Question: Can you help me better understand the difference between policy basis in a normal policy and policy basis on a modified endowment contract. From the Coursework: But for MEC purposes, the basis is increased by any portion of loans that were considered taxable income…

Course: Insurance PlanningLesson 17: Business Uses of Life and Disability Insurance Student Question: I have a quick question regarding buy/sell agreement; not clear who would pay the premiums on disability and or life insurance on the principals and the key employees? Instructor Response: Great question.  A buy-sell agreement relates to owners of the business while…

Course: Fundamentals of Financial PlanningLesson 5: Using the Calculator Student Question: I am confused as to how to get the correct answer for 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.…

Course: Income Tax PlanningLesson 10: Recognition of Expenses, Losses, and Deductions Student Question: Question 5 (below) did not make sense to me. I started out by breaking down by year —  400,000/2,100,000*3,000,000 and so forth, but did not arrive at the correct answer.  So then I tried adding up 3 year —  400+650+700/2100000*3,000,000.  That wasn’t…

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

Course: Fundamentals of Financial PlanningLesson 5: Using the Financial Calculator Student Question: I have a question about NPV. In the section “NPV and IRR Review Questions”, the first question references someone trying to decide if they should prepay tuition.  Here is the question: Instructor Response: When I look at the answer keystrokes, it appears as…