Customer Accounts--Objectives and Tax Issues Flashcards
For a gain to be considered long-term, the asset must be held for ______________________.
For a gain to be considered long-term, the asset must be held for more than one year.
Is a gift of $14,000 per person, per year, exempt from gift tax?
Yes
If an asset was held for one year or less prior to its sale, any gain or loss would be ____________.
If an asset was held for one year or less prior to its sale, any gain or loss would be short-term.
If there are losses remaining after offsetting gains, what amount may be used against ordinary income?
A maximum of $3,000.
Income and estate tax are examples of a ___________ or __________ tax.
Income and estate tax are examples of a progressive or graduated tax.
Progressive taxes are also referred to as ____________ taxes.
Progressive taxes are also referred to as graduated taxes.
If a client refuses to provide certain information, may the account still be opened?
Yes, although name and address are required.
Regressive taxes are also referred to as _______ taxes.
Regressive taxes are also referred to as flat taxes.
If a client wins $1 million, what should a RR do?
Update the account form
What is not pertinent when opening an account, a client’s educational or financial background?
Educational background
What are the capital gains tax rates?
Short-term gains are taxed at ordinary income rates, and long-term gains are taxed at a maximum of 20%.
What is some of the important information to obtain when opening a new client’s account? 11
- Name,
- address,
- age,
- occupation,
- SSN,
- citizenship,
- income,
- net worth,
- objectives,
- risk tolerance,
- investment experience
How large can a gift be between spouses and remain exempt from the gift tax?
An unlimited amount
What generates a capital gain or loss?
The sale of an asset at a price that exceeds its basis (gain) or at a price lower than its basis (loss)
Is a gift of $28,000 per married couple, per year, exempt from gift tax?
Yes
