Tax & Financial Planning for Retirement

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

Chapter 1

• Differentiate short-term financial goals and investment purposes.
• Specifying ways to hold title to assets starting with the simplest and most direct way to hold property and citing the tax benefits and drawbacks of co-tenancies, corporations (both C & S), partnerships, qualified retirement plans, and trusts
• Recognize the importance of early retirement planning using a balance sheet method and identify cost and income needs specifying the purpose of savings.

Chapter 2

• Identify money management specifying income types, recognize causes of increased taxable income for itemizing taxpayers, and specify taxable income types and their proper reporting.
• Determine the distinctions between tax-free and tax deferred income, and identify tax-deferred investments.
• Specify ways to shelter income stating how income sheltering amplifies investment return.
• Recognize the budgeting of income into cash by containing expenditures and developing discretionary income and determine how to convert income into assets by purchasing investments
• Specify tax-advantaged investments citing management rules and determine the economic impact of accelerating deductions.

Chapter 3

• Identify the barriers to wealth preservation stating how to design a budget to increase discretionary income and determine net worth using a balance sheet.
• Specify why individuals should take primary responsibility for investment planning and recognize basis planning tactics.

Chapter 4

• 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.
• 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 5

• 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.
• Determine the requirements of business asset expensing under §179 and identify sources of §172 net operating losses (NOLs) recognizing carryback and carryover rules.

Chapter 6

• 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.
• Identify the use of custodianship to split income specifying “kiddie” tax considerations and recognize good investments for children including bonds.

Chapter 7

• 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.
• Identify how to comply with ERISA plan requirements, and specify the proper reporting of reimbursed and unreimbursed business expenses under accountable and nonaccountable plans.

Chapter 8

• Recognize the unlimited marital deduction including its effect on the gross estate of the value of property, specify the applicable exclusion amounts for various years of death, determine a “stepped-up basis” for inherited assets, and identify the function of probate.
• Identify estate planning goals, recognize the benefits and drawbacks of the primary dispositive plans and specify the various types of estate trusts and family estate documents.

Chapter 9

• Identify the goals and purposes of asset protection recognizing the objections some people have about shielding assets from creditors citing situations that can unexpectedly put assets and financial security at stake and basic protection concepts.
• Recognize the importance of creditor types associated with asset protection and fraudulent transfers.
• Specify fraudulent transfer laws listing badges of fraud, and define statutes of limitation, criminal penalties, and permissible asset transfers.
• Recognize the degree and necessity of an asset protection plan using net worth and asset values on a balance sheet.
• Identify the ways that insurance and buy-sell agreements can offer asset protection citing the asset protection elements of homeowner’s, automobile, and disability insurance.
• Recognize the asset protection advantages and disadvantages of ownership formats and entities determining the use of individual ownership and corporate and identifying testamentary trusts, living trusts, and subcategories of trusts
• Identify the requirements for an enforceable marital agreement, and determine what constitutes post-nuptial and premarital agreements stating how they relate to divorce settlements and divisions.