Those taking the July CFP® exam are well-served by understanding the new Medicare taxes. The 3.8% Medicare tax on unearned income and the .9% Medicare tax on wages and self-employment income are likely to be tested on the July Exam.
The good news is that the Board is expected to provide the adjusted gross income phase-outs in the tax tables provided with the exam booklet. July exam takers (“examinees” in CFP Board parlance) should understand these taxes well enough to help hypothetical clients avoid the tax.
How about a planning tip that could help examinees this July? Income tax-exempt municipal bond interest is not subject to these new Medicare taxes!