Series 65 - investment suitability

Cost basis for tax-deferred retirment accounts is

$0

529 max contribution per year

$16,000 per donor

UGMA contribution limit

$16,000 to avoid gift tax

403b contributon limiit

$19,500

Earnings on UGMA and UTMA avoid kiddie tax up to what limit

$2,,300

Coverdell ESA max contribution per account

$2,000

Contribution limit for 401k participants

$20,500 for singles

Early withdrawal for chhildbirth expenses provision allows up to

$5000 withdrawed

IRA Contribution limit

$6,000 per person

401k catch up provision limit

$6,500

Over age 50 catch up provision max contribution for IRA's

$7,000 per person

Accelerated 529 gift of 5 years up to limits of

$80,000

A 30 year old needs to withdraw $20,000 from his IRA for his childs education. What is true concerning the taxation on the individual?

Withdrawal are subject to regular taxation - the entire amount will be taxed as ordinary income - 10% premature penalty will be exempt

HSA owner that make withdrawls for nonhealth expenses receive

a 20% penalty

Pledging on or making a bona fide loan of stock is NOT

A SALE

common methods of minimizing one's estate value and the subsequent taxation on the estate:

I: Making nontaxable gifts II: Establishing irrevocable trusts

C corporations have what type of liability?

Limited liability - shareholders liability is limited to the amount invested

What type of retirement plans are NOT subject to ERISA?

- 457 Deferred Comp Plans - Municipal Retirement Plans - Not state, county, policeman, fireman - 403b's -IRAs

What is the most important non financial considerations for investment recomendations/

- Attitude toward money and risk - level of investment experience - risk tolerance

which of the following would help an adviser assess an Investors Experience level? 1. current holdings 2. birthdate 3. employer-sponsored plan 4. education level

1. current holdings 4. education level

What are the three main sources of retirement income?

1. social security 2. Emmployer/retirement plans 3. Personal assets

Rollover federal withholding is

20%

Coverdell ESA may not be used after the age of

30

RMD penalty if distributions aren't taken?

50%

premmature distributions happen before age

59 1/2 10% penalty

excess contributions receive a penalty of

6%

Non-direct rollovers must be completed within

60days

HSA owners may withdraw funds for nonhealth expenses after the age

65

RMD's are required to be taken from Trad IRA at age

72

Which investment is most tax efficient? A. Corporate Bond B. Growth Fund C. Index Fund D. Government Bond Fund

C. Index fund Passively managed so you can expect less capital gains distributions from less transactions

ERISA three C's

Choice, Control, Communication

What is a court order to a pension plan t make a qualified distribution to a third party?

QDRO

An individual set up a trust for herself that will bypass probate, but will allow her to retain contol of her trust assets during her lifetime. what type of trust is it

Revocable Trust (living trust) (Grantors trust)

A 403b plan is commonly referred to as a

TSA Tax Sheltered Annuity

HSA contributions are

Tax deductible for employers and employee

The first home buyer provision to withdraw money from an IRA account for a purchase is available in

Trad and Roth IRAs

What would you expect as an investor ages?

Transitioning from small cap to large cap investors tend to become more conservative as they age.

Before the age of 30, coverdell ESA's must be rolled into

another qualified family member for his or her education without penalty of 10%

The most subjective suitability determination is the clients

attiitude towards risk

In order for a 401k plan to comply withh ERISA Section 404c the plan must

have atleast 3 investment options

Negative correlation between securities in a portfolio

increases diversification

Capital gains, dividends and earning of UTMA accounts are tax liabilities of the

minor

a ERISA plan fiduciary must allow participants the

opportunity to change investment options at least once per quarter

Roth IRA contributions are

paid with after-tax dollars

your client has won the lottery and is considering whether to take a lump sum payment or recieve periodic payments. this is an example of

time value of money

You may make cash gifts up to

unlimited ammounts