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| Author : | Danny C Santucci, JD |
| Course Length : | Pages: 142 ||| Review Questions: 120 ||| Final Exam Questions: 115 |
| CPE Credits : | 23.0 |
| IRS Credits : | 23 |
| Price : | $141.95 |
| Passing Score : | 70% |
| Course Type: | NASBA QAS - Text - Technical - NASBA Registry - IRS Enrolled Agents |
| Primary Subject-Field Of Study: | Taxes - Taxes for Course Id 99 |
| Description : | This informative course covers traditional planning tools and their utilization to protect assets. The Uniform Fraudulent Conveyance Act, the Bankruptcy Code, and various aspects of the tax law are highlighted in describing asset protection aspects of corporations, partnerships, limited liability companies, family partnerships, trusts, retirement plans, insurance products, and other conventional tools. Special topics include protection against lawsuits, costs of long-term illness, divorce settlements, foreign asset protection trusts, statutory protections, homestead provisions, exempt assets, cancellation of indebtedness taxation, and marital agreements. |
| Usage Rank : | 0 |
| Release : | 2021 |
| Version : | 1.0 |
| Prerequisites : | General understanding of federal income taxation. |
| Experience Level : | Overview |
| Additional Contents : | Complete, no additional material needed. |
| Additional Links : |
Asset Protection Tax Financial Aspects PDF version NASBA
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| Advance Preparation : | None. |
| Delivery Method : | QAS Self Study |
| Intended Participants : | Anyone needing Continuing Professional Education (CPE). |
| Revision Date : | 29-Sep-2021 |
| NASBA Course Declaration : | Participants must complete the final examination within one year of purchase and with a minimum passing grade of 70% or better to receive CPE credit unless otherwise noted on the Course History page (i.e. California Ethics must score 90% or better). After logging in click on the Course History links on your My Courses page for the Begin date and Expire date for the Final Exam. |
| Approved Audience : | NASBA QAS - Text - Technical - NASBA Registry - IRS Enrolled Agents - 99 |
| Keywords : | Taxes, Asset, Protection, Tax, Financial, Aspects, cpe, cpa, online course |
| Learning Objectives : |
As a result of studying each assignment, you should be able to meet the objectives listed below each assignment. ASSIGNMENT SUBJECTChapter 1 Introduction to Asset Protection At the start of Chapter 1, participants should identify the following topics for study:
* Sources of lawsuits * Types of liability * Basic protection concepts * Types of creditors * Badges of fraud * Statute of limitations & criminal penalties * Permissible asset transfers * Asset protection goals * Preparation for asset protection After reading Chapter 1, participants will be able to:
2. Identify situations that can unexpectedly put assets and financial security at stake and the common sources of lawsuits. 3. Recognize the author's concept of exploding and imploding liability how dealing with them is necessary for a complete asset protection plan, and the concepts of insurance, asset placement, and statutory protections when ap-plied to asset protection. 4. Specify the types of creditors associated with asset protection and fraudulent transfers recognizing their salient characteristics. 5. Identify the fraudulent transfer provisions which protect current and fu-ture creditors, the badges of fraud in the Uniform Fraudulent Transfer Act, applicable statutes of limitation, potential criminal penalties associated with fraudulent transfers, and the differences between fraudulent asset transfers and permissible asset transfers. 6. Determine net worth using a balance sheet, identify asset values, and show the preparation of a balance sheet in the context of determining the depth and scope of suitable asset protection planning. Chapter 2 Insurance At the start of Chapter 2, participants should identify the following topics for study:
* Life insurance * Annuities * Buy-sell agreements * Entity & cross-purchase agreements * Purchase price & terms * Community property * Professional corporations * S corporations * Sole shareholder planning After reading Chapter 2, participants will be able to:
2. Specify persons in which rights are placed by life insurance and reasons to purchase life insurance and the benefits, uses, and types of life insurance, identify variables that influence when life insurance is taxable for federal estate tax purposes, and cite reasons for establishing an irrevocable life insurance trust in order to achieve several estate tax planning advantages. 3. Determine what constitutes an annuity and the types and characteristics of annuities specifying their tax advantages and disadvantages. 4. Identify entity purchase and cross-purchase agreements recognizing tax and legal advantages and pitfalls. Chapter 3 Asset Placement At the start of Chapter 3, participants should identify the following topics for study:
* Categories of C corporations * S corporations * Types of trusts * Trust taxation * Co-tenancy * Partnership taxation & recapitalization * Family partnerships * Limited liability companies * Retirement plans After reading Chapter 3, participants will be able to:
2. Identify guidelines that corporate business owners should follow to protect their corporations, issues regarding potential personal liability for shareholders, officers, and directors, protection ideas for corporate business owners, and §469 passive loss restriction considerations. 3. Specify the advantages and disadvantages of using a corporation in asset protection planning, the differences among categories of C Corporations, recognize the importance of S corporations and their estate tax planning advantages, and determine the advantages and disadvantages of transferring farmland to a corporation. 4. Identify testamentary trusts, living trusts recognizing subcategories of trusts, and changes necessary when used for asset protection. 5. Determine how different trusts are taxed with regard to income tax, estate tax, and gift tax, identify the grantor trust rules and the effect of the treatment on owners for income tax purposes, and specify the tax consequences of several trust types. 6. Recognize the various types of co-tenancy and their impact on asset protection and tax liability. 7. Identify partnerships and their types, ways that partnerships may be better than corporations from an estate-planning viewpoint, how partnerships are taxed, how estate freezing works to minimize death taxes, and the structuring of family partnerships. 8. Specify the advantages and disadvantages of a limited liability company (LLC), problems associated with its newness, and how professional firms, joint ventures, and families can benefit from establishing LLCs. 9. Recognize how retirement plans can be used to provide substantial lifetime benefits to a business owner and to employees while simultaneously providing asset protection. 10. Identify important characteristics of custodianship and estates as asset protection tools. Chapter 4 Bankruptcy At the start of Chapter 4, participants should identify the following topics for study:
* Bankruptcy types * Automatic stay * Preferences * Priorities * Debt discharge * Individual bankruptcy estate * Individual debtor * Corporate bankruptcy * Homesteading & garnishment After reading Chapter 4, participants will be able to:
2. Specify the rules for automatic stay and levy and their impact on “freezing” creditor activity, tax assessment, and collection. 3. Identify the differences between preferential and nonpreferential payments specifying the priority of creditor claims. 4. Recognize when debt is discharged under various bankruptcy types and how to establish an individual bankruptcy estate determining its taxable income and filing requirements, and identify the special rules that apply to individual debtors, partnership bankruptcies, and corporate bankruptcies. 5. Specify debts covered under homesteading, and determine permissible garnishment amounts recognizing special garnishment rules. Chapter 5 Avoiding Tax on Debt Cancellation & Foreclosure At the start of Chapter 5, participants should identify the following topics for study:
* Real property business debt * General ordering of tax attribute reduction * Reduction of tax benefits * Basis reduction * Partnership bankruptcy * Corporation stock-for-debt rule * S corporation bankruptcy * Foreclosure * Discounted acquisition of debt After reading Chapter 5, participants will be able to:
2. Identify tax attribute reductions and their application when reducing canceled debt, cite the special basis reduction rules, recognize the depreciable property election in reducing the basis of depreciable property before reducing any other tax attributes, determine what constitutes individual, partnership, and S corporation bankruptcy, and specify the variables used in determining whether shares of stock issued to a creditor are nominal or token. 3. Determine gain or loss resulting from foreclosure or repossession identifying reporting and filing requirements, specify the timing and character of the gain or loss, and cite the hidden income tax danger of directly or indirectly acquiring one's own debt at a discount. Chapter 6 Divorce Settlements & Divisions At the start of Chapter 6, participants should identify the following topics for study:
* Application of §1041 * Incident to divorce * Property basis * Purchase of residence between spouses * Purchase of business & investment property between spouses * Division of corporate business interests * Division of partnership business interests * Deferred v. present division of benefits * Individual retirement arrangements After reading Chapter 6, participants will be able to:
2. Determine the application of §1041 to interspousal transfers, the tax trap of deferred tax liability, and the transferor’s and transferee’s property basis under §1041(b). 3. Specify the deferred gain or loss associated with selling an interest in the marital residence, recognize the application of §1041 to selected business, retirement, and investment assets, and identify conditions that must be met for a like-kind exchange to be nontaxable. 4. Recognize tax consequences resulting from the division of certain types of property between spouses or former spouses incident to divorce, and identify the elements of a Qualified Domestic Relations Order (QDRO). Chapter 7 Protecting Assets from Old Age & Catastrophic Illness At the start of Chapter 7, participants should identify the following topics for study:
* Medicare * Medicaid & countable assets * Medicaid & non-countable assets * Medicaid & inaccessible assets * Private insurance * Healthcare decisions * Supplemental Security Income * Income & assets * Disability benefits After reading Chapter 7, participants will be able to:
2. Recognize the concept of durable power specifying how to maximize its use, and identify funded revocable living trust variations and their advantages. 3. Determine eldercare benefits of Medicare and Medicaid, countable income, and asset groups under Medicaid. 4. Identify possible health care decisions such as having a living will, determine the distinctions between Supplemental Security Income and Social Security disability benefits, identify assets groups for SSI, and specify requirements for SSI and Social Security disability benefits. |
| Course Contents : | Chapter 1 - Introduction to Asset Protection Why Asset Protection? Situations That Create Danger Sources of Lawsuits Types of Liability Basic Protection Concepts Types of Creditors Evading Creditors Fraudulent Transfers Badges of Fraud Statute of Limitations Criminal Penalties Permissible Asset Transfers Asset Protection Goals Preparation Chapter 2 - Insurance Homeowners Insurance Automobile Insurance Disability Insurance Life Insurance Purpose Tax Overview Income Tax Transfer for Value Rule Employee Death Benefit - §101(b) Repealed Premiums Lifetime Benefits Section 72 Estate Taxes - §2042 & §2035(a) Ownership Gift Taxes Community Property Gift Danger Life Insurance Trust Considerations Annuities Deferred Annuity Private Annuity Unsecured Promise Regulations Restrict Private Annuities Buy-Sell Agreements Definition Contractual Format Funding Life Insurance Funding Term vs. Whole Life Policy Ownership & Premium Payment Entity & Cross-Purchase Agreements Tax Consequences - Cross-Purchase Agreements Non-Deductible Premiums No Dividend Danger Tax Consequences - Entity Purchase Agreements Non-Deductible Premiums Dividend Danger - §302 Exception to Dividend Treatment Constructive Ownership (Attribution) Rules “Estate/Beneficiary” Rule “Family/Trust/Corporation” Rule No Gain on Sale Estate Tax Valuation Using the Buy-Sell Agreement to Set Value Buy-Sell Agreements - §2703 Exceptions to §2703 Arms-Length Bargain Substantial Modifications Exceptions Purchase Price & Terms Valuation Community Property Professional Corporations Marketability Problems Controlled Disposition S Corporations Sole Shareholder Planning Complete Liquidations Alternative Dispositions Use of Life Insurance Estate Valuation One-Way Buy-Outs Chapter 3 - Asset Placement Ownership Vehicles & Entities Individual Titles & Sole Proprietorship Individual Marital Property Timing & Domicile Community Property Tax Basis Advantage Sole Proprietorship Corporate Categories of C Corporations Personal Holding Company - §541 Attribution Rules Penalty Tax C Corporation No Pass-Through Getting Money Out of the C Corporation Passive Loss Restrictions Partnership vs. Corporation Personal Service Corporation - §269A The S Corporation - §1361 Minors as Shareholders Bequests & Estate Ownership Trusts as Shareholders S Corporation Assets Built-In Gains Tax - §1374 Incorporation of a Farm Land Partnership Advantage Leasebacks Trusts Types of Trusts Revocable Trust Land Trusts Irrevocable Trusts Testamentary Trust Business Trusts Foreign Trusts - §679 Grantor Trust Rules - §§671 through 679 Asset Protection Trusts - APTs Foreign Jurisdictions Alternatives Income Taxation Estate & Gift Tax Creditor Protection Family Trusts Medicaid Trusts Living Trust Reversion Advantages of a Living Trust Disadvantages Priority Pour-Over Will Trust Taxation Income Tax Grantor Trusts - §671 to §678 Grantor Retained Income Trust Irrevocable Trust Taxation Throwback Rules Capital Gains Deduction of Estate Planning Expenses Deductibility of Death Expenses Domestic Trust Exemptions Gift Tax Estate Tax Unlimited Marital Deduction Outright to Spouse Marital Deduction (QTIP) Trust Qualified Terminable Interest Trust “A-B” Format “A-B-C” (QTIP) Format Valuation & Tax Basis Alternate Valuation Choice of a Trustee Corporate Trustee Factors Individual Trustee Factors Co-Tenancy Tenancy in Common Percentage Interests No Survivorship Joint Tenancy with Right of Survivorship Taxation Percentage Interests Tenants by the Entirety Partition Partnership Partnership Taxation Allocation of Income & Deduction Partnership Recapitalization Two Class Format Valuation Guaranteed Payment Control & Management Estate Issues Family Partnerships Charging Orders Phantom Income to Creditor Tax Issues Estate Savings Income Tax Savings Family Partnership Requirements Recognizing a Partner Control Transferability Donee as a Partner Trusts as Partners Minor As a Partner Purchased Interests Capital Interest in the Partnership Capital as a Material Income Producing Item Source of Capital Family Partnerships Not Within §704(e) Real Estate Family Partnerships Business Family Partnerships Structuring the Family Partnership Limited Liability Company Outside Basis & Debt Share Advantage Substantial Economic Effect Rules Discharge of Indebtedness Income Suggested Uses Professional Firms Joint Ventures Substitute for Family Limited Partnership Retirement Plan Plan Types Retirement Fund Protection in Bankruptcy Employer Costs Profit-Sharing Plan Money Purchase Pension Plan Defined Benefit Pension Plan Custodianship Estate Chapter 4 - Bankruptcy Federal Bankruptcy Means Testing Median State Income Test Means Test Credit Counseling Tax Law Changes Chapter 13 "Superdischarge" Subordination Of Ad Valorem Tax Liens Interest on Tax Claims Tax Returns Bankruptcy Types Chapter 7 - Liquidation Exempt Assets Availability Trustee Appointment Chapter 11- Reorganization Availability Creditors’ Committee Reorganization Plan Chapter 13 - Wage-Earner Plan Availability Repayment Plan Trustee Appointment Automatic Stay Tax Assessment Suspension of Statute of Limitation Immediate Assessment Levy Tax Court Tax Court Petition Preferences Trust Fund Taxes Allocation of Tax Payments Priorities Super Priority Claims Secured Claims Federal Tax Liens Priority Claims Tax Claim Determination Refunds Priority of Tax Claims Second Priority Tax Claims Third Priority Tax Claims Four Generates Priority Eight Tax Claims Eighth Priority Tax Claims Debt Discharge Chapter 7 Discharge Chapter 11 Discharge Chapter 13 Discharge Discharge of Taxes Tax Liens Individual Bankruptcy Estate Separate Entity Tax Attribute Carryovers Termination of the Estate Filing Requirements Disclosure of Return Information Taxable Income Taxable Year Gross Income Deductions & Credits Administrative Expenses Net Operating Loss Carryback Transfers to Debtor Partnership & S Corporation Interests Request for Prompt Determination of Liability Tax Liability Individual Debtor Tax Year Election Annualizing Taxable Income Making the Election Later Bankruptcy of Spouse Election Considerations Transfers between Debtor & Estate Net Operating Loss Carryback Limitation Partnership Bankruptcy No Separate Estate Discharge of Debts Corporate Bankruptcy Exemption Return Filing Personal Holding Company Tax Tax-Free Reorganizations §354, §355, & §356 Corporate Liquidations under Chapter 7 Carryover of Tax Items - §381 & 382 Bankruptcy Exception Reduction of Carryforwards Section 269 Presumption Homesteading Types of Homesteads Property & Equity Covered Who Can Homestead? Excluded Debts Garnishment Chapter 5 - Avoiding Tax on Debt Cancellation & Foreclosure Income Inclusion Rule Exceptions from Income Inclusion Order of Exclusions Bankruptcy Case Exclusion - §108(a)(1)(A) Insolvency Exception - §108(a)(1)(B) Qualified Farm Debt Exclusion - §108(a)(1)(C) Qualified Farm Debt - §108(g)(2) Qualified Person - §108(g)(1) Real Property Business Debt - §108(a)(1)(D) Qualified Debt Exclusion Limit Ordinary Income Recapture Partnerships Deemed Distribution Rules S Corporations Student Loan Exception - §108(f) Purchase Money Debt Reduction Exception - §108(e)(5) Cancellation of Deductible Debt Exception - §108(e)(2) Reduction of Tax Benefits (Attributes) - §108(b) General Ordering of Tax Attribute Reduction Basis Reduction Depreciable Property Election Procedure Required Reduction Timing of Basis Reduction Limit on Basis Reduction Recapture of Basis Reductions Exempt Property Special Basis Reduction Rule for Qualified Farm Debt Qualified Property Basis Reduction Order Exclusion Limit Individual Bankruptcy Partnership Bankruptcy Depreciable Property Allocation of Debt-Discharge Income Corporate Stock-For-Debt Rule Token Share Inclusion Workout Inclusion Recapture of Gain on Later Sale Debt Contributed to Capital Debt-For-Debt Exchange Earnings & Profits S Corporation Bankruptcy Net Operating Losses Adjustments to Shareholder’s Basis in Debt Bankruptcy Estate as Shareholder Reporting Mortgage Debt Relief Act of 2007 Qualified Principal Residence Indebtedness Mixed Indebtedness Amount Realized On Sale or Other Distribution of Property Foreclosure Nonrecourse Indebtedness Recourse Indebtedness Reporting Form 1099A Timing & Character of Gain or Loss Gain Loss Lender’s Tax Impact Foreclosure Sale Discounted Acquisition of Debt Transactions Involving Related Parties Related Persons Chapter 6 - Divorce Settlements & Divisions Premarital Agreements Uniform Premarital Act - The California Example Permitted Items of Agreement Unenforceable Items Retirement Equity Act of 1984 Benefits of a Premarital Agreement Post-Nuptial Agreements Divorce Settlements - The Tax Trap Section 1041 Application of §1041 Mandatory Scope Property vs. Income Savings Bonds Receivables Interest Imputed Interest Incident to Divorce Related To Termination Rebuttable Presumption Divorce or Separation Instrument Transfers in Trust Third Party Transfers Property Basis Gift Variation Passive Activity Loss Property Property Transferred In Trust Basis in U.S. Savings Bonds Negotiated Property Divisions Adjudicated Property Divisions Caselaw General Rule - Immediate & Specific Liabilities Holding Period Notice & Record Keeping Purchases Between Spouses Residence Home Mortgage Interest Deferral & Exclusion of Gain Business & Investment Property Recapture Section 1031 Exchange Installment Sale of Assets Selected Asset Divisions Installment Obligations Business Interests Corporations Section 302 Redemption Recapitalization Partnerships Section 736(a) Payments Effect on Recipient Section 736(b) Payments Effect Exclusions From §736(b) Treatment Liabilities Series of Payments Section 754 Election Insurance Policies Pension Benefits Qualified Domestic Relations Order Taxation of Distributions Deferred v. Present Division of Benefits Deferred Division Arguments Present Division or Alternate Property Arguments Individual Retirement Arrangements IRA Deduction Limit Rollovers Divorce Distributions Amounts Not Rolled Over Military & Civil Service Pensions Chapter 7 - Protecting Assets from Old Age & Catastrophic Illness Managing the Estate Joint Tenancy Conservatorship Durable Power Revocable Living Trust Catastrophic illness Medicare Medicaid Countable Assets Non-Countable Assets Personal Residence Gifting the Residence - General Rule Exceptions Inaccessible Assets Gifts Spousal Transfers Spousal Allowance Medicaid Trusts Limited Trust Exceptions Criminalization of Medicaid Asset Transfers Private Insurance Health Care Decisions Supplemental Security Income Income Unearned Income Earned Income Exempt Income Assets Countable Assets Non-Countable Assets Disability Benefits Blind Kidney Disease AIDS Glossary |
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