Quiz 3 Flashcards
If a family has more than one child in college in same year, can they apply for multiple AOCs?
yes. $2500 for first four years of college
is there an age limit for the Lifetime Learning Credit?
no
What’s the Lifetime Learning Credit maximum per year?
$2,000
How long after close of fiscal year do federal covered advisers have to update their ADV forms?
90 days (fed)
How often can you elect the Section 121 exclusion?
no more than every 2 years
What happens to a gift of cash to an irrevocable living trust?
it’s removed from the gross estate for federal estate tax purposes
What is the deductibility of a loss from a non-publicly traded partnership?
none, as a loss. it’s a passive loss. Can only take it when the partnership is sold or at holder’s death.
What’s a 125 plan?
FSA
What triggers transfer for value rules?
selling a policy to anyone but the insured
Are K-1s and schedule C income considered earned?
no
Recapture of 72(t): what do you have to pay?
10% of total payments received before age 59-1/2 and interest.
For spousal or deductible IRA purposes, does it matter if the plan you’re an active participant in is qualified or not?
no it doesn’t.
PIA
primary insurance amount
FRA
full retirement age
Reducing benefits formula
months before FRA, reduced $1 for every $2, 18240
during fra year, 1 for ever 3 over 48000
QHEE
qualified higher education expense
QTP
qualified tuition program
Two types of 529s
- College savings
2. Prepaid tuition
Keys: College savings (8)
- invested, risk tolerance, market based perf
- parents/grandparents’ asset
- open enrollment
- includes grad
- not just tuition & fees
- out of state ok
- not state guaranteed
- refunds (huh?) return inv, but earnings 10%penalty (prob if not used for educ0
Keys: Prepaid tuition (8)
- tracks tuition infl, risk averse
- parent/grandparent asset
- could be just underg4ad
- tuition & fees only
- in state may be better
- not necc state guaranteed
- choice of school impacts inv return
- refunds no penalty
Particular of the $75K gifting limit
an individual can gift 5 years in advance. that uses up the gift exclusion for gifts to the bennie of the 529 for 5 years. if you go over that within 5 years — gift tax
Can couples each do the $75k to 529?
heck yeah
Can couples go over 75k or 300k to gift to multiple children?
yes. $75,000 per person per gift. gift splitting. multiple children. in book example up to 600k, more.
How many times can you do a 529 rollover in 1 year?
once. not that anyone would do more. or even that much.
