Tax Analysis of Invesment Using the Internet
Field of Study:
Taxes aren't taxes they are dollars in terms of the net return on investment. All tax professionals need to know the tax-economics of investing for themselves and their clients. This need is accentuated by the rapid rise of the Internet as a broad-based and effective investment tool.
The tax professional is in a special position to detect a client's need for financial planning. Preparing returns discloses assets, savings, business entities, and family members. Knowledge of the client's assets, activities and the tax characteristics of available entities permits investment matching for maximum after-tax return.
The basic tax characteristics of the primary tax entities are explored and ana-lyzed. Their ability to defer, reduce, and eliminate tax is examined. Client goals, purposes and risk tolerances are determined and quanitated using the Sharp ra-tio. Investments and assets are then evaluated using a variety of tools found on the Internet. Finally, investments and entities are matched to produce the best after-tax return for the client.
After completing this section, you should be able to:
- Determine the differences between goals & purposes when retirement planning and how to implement strategies to preserve wealth by main-taining buying power.
- Identify the various cash management strategies and their effectiveness as part of an overall financial plan.
- Specify categories of assets noting their role in improving investment planning.
- Recognize the impact of Social Security and insurance in developing a financial plan for retirement.
- Identify active versus passive investment selection and evaluation strategies and the role each of the techniques can play in a financial plan for retirement.
- Determine the role income in money management by identifying the various types of income particularly tax-free and tax-deferred income and their impact on financial and retirement planning.
- Recognize the principles of budgeting and cash management to in-crease discretionary income by citing budgeting techniques and speci-fying how to expand financial planning opportunities though the use of savings, deductions, and emergency funds.
- Identify ways to manage assets using the authors guidelines for pur-chasing assts and specify rules for acquiring financial assets that im-prove investment return and minimize risk.
- Recognize the tax advantages of accelerating deductions and lever-aging the purchase of assets.
- Recognize the impact of taxes, inflation, and bad spending habits on wealth preservation and a budget to increase discretionary income.
- Identify the process of taking an asset inventory noting its impact on net worth and variables that impact net worth.
- Specify the importance of personal responsibility when it comes to financial planning noting the importance of personal control over fi-nances and recognize the role of asset allocation, risk tolerance, diver-sification, and tax planning tactics in maximizing investment returns.
- Identify the unlimited marital deduction noting its effect on the value and death transfer of property and specify the tax implications of the applicable exclusion amount for estate planning.
- Recognize stepped-up basis at death and its importance to surviving spouses and heirs.
- Determine primary dispositive plans and identify their effects on estate planning starting with simple wills, identify the various asset types that are included and not included in wills, and specify the various types of trusts and their characteristics noting their advantages and disadvantages relative to estate planning.
- Recognize the roles of a conservatorship and durable power of at-torney play in estate planning and identify the advantages and disad-vantages of former private annuities.
Recommended CPE credits:
Type of delivery method:
Final examination expiration date:
The program participant will have one year from the date of purchase to complete the course and final examination.
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