CRPC EXAM ACTUAL EXAM QUESTIONS AND CORRECT DETAILED ANSWERS WITH RATIONALES (VERIFIED ANSWERS) |ALREADY GRADED A+(UPDATED 2024)

A fundamental duty owed to a client is to always look out for what is in the client's best interest, what fiduciary duty best personifies this?=====duty of loyalty The fiduciary duty that best personifies looking out for the client's best interest first is the fiduciary duty of loyalty. This duty requires being loyal to the client first and foremost, and always looking out for what is in their best interest.;A lump sum payment of the proceeds of a life insurance policy that is made to the beneficiary upon the insured's death=====is generally exempt from income taxation. The lump sum proceeds of a life insurance policy (even if a MEC) paid to a beneficiary are generally exempt from income taxation. Withdrawals and loans from a MEC may be taxable. Life insurance proceeds, however, are subject to estate taxes if the deceased owned a life insurance policy. If the deceased owner was also the insured, the death benefits are included in his estate. If the deceased owner is not also the insured, the current value of the policy is in the deceased owner's gross estate.;A Medicare Part A patient must pay=====The patient must pay all costs related to a hospital stay beyond 150 days. The annual deductible describes a gap in Medicare Part B coverage, not Part A. Medicare pays for the cost of the first 60 days in a hospital, but the patient must pay the Part A deductible. Medicare will pay the approved charges for the first 20 days in a skilled nursing facility. The gap results from the cost of care that exceeds 20 days (the patient pays the per day copayment) or the need for custodial care.;A springing durable power of attorney:=====A) is usually created in a person's revocable trust. B) gives the attorney-in-fact authority only when the principal becomes incompetent. C) remains effective after the principal's death. D) remains effective after the principal becomes incapacitated. --B The very purpose of any durable power of attorney is to give the attorney-in-fact authority to act after the principal becomes incapacitated. However, such authority does not survive the principal's death. Such authority is created in an independent document (not part of a living will or a living trust), and is effective immediately in this type of power of attorney. A springing durable power of attorney becomes effective when the principal becomes incompetent or incapacitated.;Adjusted Gross Income (AGI)=====Is defined as gross income minus adjustments to income. Gross income includes your wages, dividends, capital gains, business income, retirement distributions as well as other income. Adjustments to Income include such items as Educator expenses, Student loan interest, Alimony payments or contributions to a retirement account. Your AGI will never be more than your Gross Total Income on you return and in some cases may be lower. Refer to the 1040 instructions (Schedule 1) for more information. If you are filing using the Married Filing Jointly filing status, the $72,000 AGI limitation applies to the AGI for both of you combined. To e-file your federal tax return, you must verify your identity with your AGI or your self-select PIN from your 2019 tax return.;All of the following are reasons reverse mortgages may become more common in the future except: CRPC EXAM ACTUAL EXAM QUESTIONS AND CORRECT DETAILED ANSWERS WITH RATIONALES (VERIFIED ANSWERS) |ALREADY GRADED A+(UPDATED 2024) A)reverse mortgage fees must be rolled into the loan. B)reverse mortgages are a potential tool for combating sequence of return risk. C)many older Americans have large amounts of equity in their homes but lack liquid assets capable of sustaining their lifestyle. D)government regulatory changes in 2013 standardized Home Equity Conversion Mortgage (HECM) rules to a great extent.=====--A Fees may be rolled into the reverse mortgage, but that is not required. Until the late 1990s American tax law had strong incentives to purchase ever more expensive homes. This effect lingers on today. Next, people have to live somewhere. Buying a home is a forced savings plan as the mortgage is repaid each month. In addition, increases in home prices over time help accrue wealth. Reverse mortgages have the potential to fight sequence of return risk in several ways. First, reverse mortgage loans can pay off the original mortgage and thus eliminate the need for the original mortgage amount each month. Lowering income needs reduces the monthly need. Reducing the monthly need takes pressure off the portfolio. Also, money from a reverse mortgage is tax free (like all other loans received). Additionally, during a market downturn, monthly payments from a reverse mortgage can be substituted for portfolio withdrawals. In fact, the monthly reverse mortgage amount can be smaller than the normal withdrawal from a non-Roth retirement plan because the amount of income tax required with the retirement plan withdrawal is not needed when the monthly income is coming from a reverse mortgage.;All of the following are ways that a person can voluntarily transfer estate assets to another person or entity at death except: A) by will substitute. B) by gift. C) transfer on death (T.O.D.). D) by probate.=====-- B Probate and will substitute are ways that a person can voluntarily transfer estate assets to another person or entity at death. Gifting is one of the two ways that a person can voluntarily transfer estate assets to another person or entity during life, not at death. T.O.D. passes the brokerage account to the named person when the owner of the account dies. P.O.D. (payable on death) transfers a bank account in the same way.;All of the following assets would be included in a decedent's gross estate except=====--the proceeds from a life insurance policy on the decedent that was always owned by the decedent's spouse, with the spouse as the named beneficiary. Because the decedent never owned this policy, and his estate is not the beneficiary, these proceeds are not included in the decedent's gross estate. The decedent's retained right to income in option c. causes inclusion. The decedent owned an interest in the residence at death, and therefore his interest must be included in his gross estate. If the decedent assigned incidents of ownership in this policy within three years of death, the proceeds must be included in the decedent's gross estate.;An income-tax-penalty-free distribution cannot be made from a tax￾sheltered annuity (TSA) until the employee does which of the following?=====I. separates from service after attaining age 55 II. attains age 55 CRPC EXAM ACTUAL EXAM QUESTIO