Matching Investments to Tax Saving Techniques

Upon successful completion of this course, participants will be able to:

Chapter 1

• Specify steps in the mapping process to prepare for financial independence identifying retirement myths, recognize investment planning goals and purposes, and identify resource allocation including necessary generational changes;
• Determine how to manage income to generate cash and acquire assets, differentiate physical and financial assets including stocks and bond types, and recognize the major types of life insurance including their use as financial planning tools; and
• Identify active and passive investment acquisition strategies.

Chapter 2

• Identify tax and legal title formats and the distinctions among these entity formats recognizing co-tenancy, partnerships, custodianships, retirement plans, and estates, and determine their advantages and disadvantages in holding assets and dealing with income.

Chapter 3

• Identify the benefits of tax deferral and recall the tax deferral advantage under §1031 listing its elements;
• Specify the related party §1031 restrictions identifying prohibited parties or entities, disallowance of personal property and partnership exchanges, and recognize the use of an intermediary in exchanges;
• Identify retirement plan design, and list popular methods for providing for retirement; and
• Specify the requirements for an installment sale, identify the application of the at-risk rules, and determine how to use a property option to receive income and postpone tax.

Chapter 4

• Identify tax credits specifying qualified computational expenses, limitations, and restrictions.
• Recognize the types of deductible and nondeductible interest including personal, investment, and prepaid interest.
• Identify business vehicle operating costs using (or switching between) the actual cost method or the standard mileage rate.
• Recall the statutory exceptions to the disallowance of entertainment deductions and recognize the application of R.R. 90-23 and R.R. 99-7 to the deduction of transportation costs to a temporary work location.

Chapter 5

• Recognize formats for income splitting, determine the restricted tax treatment of employee business expenses, and cite changes made to home office deduction under TRA ’97;
• Identify the tax treatment of personal and business casualty losses and bad debts;
• Determine the uses and tax characteristics of regular and S corporations by recognizing the taxation of these entities including their ability to split income;
• Recognize the use of partnerships to split income among partners and reduce estate taxes; and
• Identify the use of custodianship to split income specifying “kiddie” tax considerations and recognize good investments for children including bonds.

Chapter 6

• Recognize the requirements of the current §121 home sale exclusion citing its differences with prior tax law and specify the tax elimination aspects of interfamily transactions such as divorce and gifts;
• Recognize employer deductions as a means to increase tax-free incentive-based compensation for employees using fringe benefits under §132 and employer-paid accident & health coverage; and
• Identify how to comply with ERISA plan requirements, and specify the proper reporting of reimbursed and unreimbursed business expenses under accountable and nonaccountable plans.