CTFA Practice Exam With Latest Updated Solutions 2024

CTFA Practice Exam With Latest Updated Solutions 2024 "Constructive Receipt" is normally applicable to the tax treatment of... - correct answer.Non-Qualified Deferred Compensation Plans Non-Qualified Deferred Compensation - correct answer.TCHRA: Compensation that is not immediately taxable. It does not qualify under ERISA for tax exemption. Taxation occurs once the individual receives the compensation or "property" A 1035 exchange refers to a tax free exchange of... - correct answer.Annuities 1035 Exchange - correct answer.IRS allows tax-free transfer of cash values between 2 LIKE policies (i.e. Life to Life, Annuity to Annuity, or Life to Annuity). If a bank uses its own proprietary mutual funds for fiduciary accounts then it should do the following (3) - correct answer.-Be able to substantiate the reasonableness of using these funds -Explain the fees associated -Monitor the fund's investment performance A simple trust earned $27,000 in dividends. It paid $4,000 in trustee fees. 1/2 from Income and 1/2 from P. What is the DNI? - correct answer.$23,000 T/F: In a simple trust, trustee fees are deducted from DNI even the fees that come out of Principal? - correct answer.True Sprinkling trust - correct answer.A trust in which the income or principal is distributed among the members of a designated class in amounts and proportions as may be determined in the discretion of the trustee or other party. Also called spraying trust. A US dollar can buy 33 Thai Baht. What is a characteristic of the Thai Baht? - correct answer.The Thai Baht is a medium f exchange to facilitate trade and of itself has no intrinsic value. A very wealthy client created a trust that names your bank as a co-trustee with an individual following the client's death. Upon reviewing the trust document, you notice that the individual trustee is granted sole and complete responsibility for all trust investment decisions. Is that acceptable? What should you follow up with? - correct answer.This is ok but you should require that trust contain broad language specifying that the bank will be exonerated (exculpated) from any decision made individual trustee. Al, Bob and Chuck purchased a $300,000 piece of real property. They each contributed $100,000 to the purchase. Which of the following forms of property ownership would automatically pass the property to Bob and Chuck if Al dies first? - correct answer.JTWROS Assume Ann, 45, leaves her job at Google and takes a similar position at Facebook. If she instructs Google's human resource department to distribute her existing 401(k) balance to an IRA, - correct answer.Google may distribute Ann's full account balance without withholding any amount. Assume that the United States is experiencing a larger than normal GDP growth and the Federal Reserve wants to "cool things off" with an interest rate hike. Which of the following BEST describes the mechanism to accomplish this objective? - correct answer.Pursue open market activities (OMA) to sell bonds. Assuming Amy created a five-year grantor annuity trust (GRAT) in 2015 with a 25% annuity payment, and she dies in 2018 - correct answer.Amy could have used her closely held business or a publicly traded stock to fund the GRAT Barney, an insurance agent, shows Myron why he needs $250,000 of additional coverage. Myron is young and has three young children. He is investment-minded and likes to play the market. Which of the following is the best option for Myron - correct answer.$250,000 variable universal life policy Compared to conventional mortgage loans, jumbo mortgage loans typically - correct a higher interest rate Currently, a retired worker, who is 67 years of age, receives $22,500 of employment earnings. Social Security benefits will be reduced by: - correct answer.0% Donor-advised funds receive the same tax treatment as contributing to - correct answer.a public charity T/F: Fiduciary powers generally apply jointly and severally to each fiduciary if there are co-fiduciaries - correct answer.True Filing a decedent's final tax return is the responsibility of the decedent's - correct nal representative Herman (age 72) is receiving annuity payments of $1,850 per month from a fixed annuity plan on a joint-and-last-survivor basis. Herman's wife Kathleen is 68 years old.