Deck 1 Factoids Flashcards
What IRS form is used to report estate taxes?
706
What is the first step in the financial planning process
Understanding the Client’s Personal and Financial Circumstances
What is the second step in the financial planning process?
Identifying and Selecting Goals
What is the third step in the financial planning process
Analyzing the Client’s Current Course of action and potential alternative courses of action
What is the fourth step in the financial planning process?
Developing the Financial Planning Recommendations
What is the fifth step in the financial planning process?
Presenting the Financial Planning Recommendations
What is the sixth step in the financial planning process?
Implementing the Financial Planning Recommendations
What is the seventh step in the financial planning process?
Monitoring Progress and Updating
What is a 5 by 5 power
- A 5 by 5 Power in Trust is a clause that lets the beneficiary make withdrawals from the trust on a yearly basis.
- The beneficiary can cash out $5,000 or 5% of the trust’s so-called fair market value each year, whichever is a higher amount.
- A 5 by 5 Power in Trust lets the person establishing the trust set guidelines, such as when a beneficiary can access funds or what the beneficiary can use the money for.
Requirements of a tax-qualified long-term care insurance policy
Guaranteed Renewable
MUST offer inflation protection
CANNOT pay for expenses reimbursable under Medicare
CANNOT require hospitalization before paying nursing benefits
CANNOT exclude any specific illness (including Alzheimers)
CANNOT offer cash surrender value
Preexisting conditions may be excluded up to a max of 6 months after issue of contract (and a new contract replacing old contract must recognize satisfaction of this)
What are the reporting consequences if the taxpayer does not keep books or accounting records
They must use the calendar year tax year
