Flashcards in Quiz 4 Deck (10):
Is a qualified plan protected by the ERISA anti alienation provision after distributions start?
No, they are only protected during the accumulation period. If a client is sued during distribution period, the distributions are partially at risk for creditors and suing.
If a trust income is used to purchase life insurance on the life of a grantor or the grantor's spouse, who pays the taxes?
The grantor pays the taxes.
Why use a family trust/disclaimer trust instead of a QPRT for the surviving spouse?
The spouse can use the exemption, but not with a QPRT.
Can an HSA pay for qualified LTC premiums?
Yes (age based).
In regard to the SML, Beta is what?
1) a constant
2) equal to the market
3) equal to 1
4) a variable
4) a variable. It's just a variable in the SML.
Self insurance refers to:
2) retention. It's not transference because nobody actually paid for insurance, it's just cash set aside for an emergency.
Can you e-mail a plan to a client who's in another country?
No this violates Standard 400 because e-mail is not a suitable delivery method of recommendations in a plan.
What is the difference between a red herring and a prospectus?
A red herring omits the selling price and the size of the issue.
Charitable contribution of inventory to a charity is limited to what?
It's cost. Cans of food worth 1000 donated to the Red Cross that are worth 2000 can only be deducted for 1000.