TCP1 - Individuals Flashcards
(13 cards)
How do you calculate the tax if property is transferred at the date of death?
FMV of property x estate transfer tax
How do you calculate the tax if property is gifted while taxpayer is still alive?
(FMV of property - $18,000 gift tax exclusion) x gift tax
(FMV of property - basis of property) x capital gains tax rate
Gift Transfer tax + Capital Gains Tax = Total Tax if Gifted
How do you calculate the nontaxable portion of an annuity?
Investment amount / (Years of annuity x 12 months) = nontaxable portion of annuity
True or False? A Section 529 Plan can be rolled over tax-free to a traditional IRA
False
True or False? A Section 529 plan can be rolled over tax-free to a Roth IRA?
True
What is the maximum contribution to an IRA for taxpayers under 50?
$7,000
What is the maximum contribution to an IRA for taxpayers over 50?
$8,000
What type of asset is weighted most heavily in determining a student’s eligibility for federal financial aid?
A custodial account owned by the student
Which type of IRA is a distribution of principal (contributions made by the taxpayer) taxable?
Deductible traditional IRA
Can a taxpayer who maxes out their 401K also contribute to a 403(b) plan?
No
What type of equity compensation award does an employee receive actual shares of the company stock rather than the right to purchase shares of the company stock?
Restricted Stock Awards
What type of equity compensation award does an employee receive cash payments equal to the increase in the company’s stock?
Stock Appreciation Rights
How to calculate the after-tax rate of return (ATRR) on this potential investment?
- Calculate ROI - (Investment sales price-cost of investment)/cost of investment
- Calculate ATRR - ROI x (1-tax rate)
