Student Question

Course: Income Tax Planning Lesson 7: Arriving at Adjusted Gross Income Student Question: Dan, can you help me with the below question? While I know a self-employed person can reduce AGI by 50%, I still couldn’t seem to come up with an answer that matched any of the choices. QUESTION Scott is a self-employed financial…

Course: Estate Planning Lesson 6: Transfer Taxation III Student Question: For “Power exercisable with consent of another”, can you explain  why the assets WOULD be included in John’s estate? Since he has  power to appoint property, wouldn’t that be adverse to Betty and  her ability to enjoy the property? The example is below. EXAMPLE Albert…

Course: Income Tax Planning Lesson 5: Gross Income Exclusions Student Question: In the Gifts & Inheritance section of Income Tax Planning and, how come there is not mention of the $15,000 gift tax limit. All it says is that gifts can be excluded from Gross Income. The amount of gifts excluded from taxable income is limited,…

Course: Investment Planning Lesson 3: Equity Securities Student Question: I don’t quite understand the corporate dividend exclusion. A corporation can exclude 70% of dividends from a different company when they own less than 20%. I don’t understand what happens when they own more than 20%. Also, is there a rule preventing companies from investing in…

Course: Investment Planning Lesson 3: Equity Securities Student Question: Hi Bruce, In reviewing the tax implications of derivatives, I had a question about the terms in & out of money. Is premium price factored into whether something is in or out of money? Or is it strictly referring to market and strike price? Thanks, Instructor…

Course: Insurance Planning Lesson 5: Personal Auto and Umbrella Liability Policies Student Question: Hi If I have liability insurance and I’m driving a vehicle that belongs to a charity (not my own vehicle) and I get into an accident, then my insurance covers this? Sarah Instructor Response: Hi Sarah- Liability coverage generally follows the car,…

Course: Income Tax Planning Lesson 1: Introduction to Taxation Student Question: Hi How is the answer to question #5 (below) $810? Jerry’s taxes were due April 15th. He filed his return in October of the same year and paid his $3,000 two months later. Would Jerry be subject to a penalty? How much? No. Jerry…

Course: Retirement Planning Lesson 4: Understanding Types of Qualified Plans Student Question: Hi Bruce- I have studied the material in depth, but am still struggling with the distinction between Money Purchase Plans, Cash Balance Plans, and Target Benefit Plans. I have read all of the notes and think I have it and then get a…

Course: Retirement Planning Lesson 1: Using IRAs to Build and Distribute More Retirement Income Student Question: Hi Bruce- If an IRA owner over-contributes to his IRA, the owner must remove the excess contribution AND the earning on those contributions by the tax filing  date to avoid a 6% tax penalty. However, the 6% penalty tax…

Course: Income Tax Planning Lesson 1: Introduction to Taxation Student Question: Hi Dan- I have a question on Review Exercise #1 (below) Review ExerciseShane’s tax return was due on April 15. He filed on April 15 but did not pay his $125 tax bill until May 11. How much, if any, will Shane be penalized?…