CDFA Exam Study Materials Questions With Complete
Solutions
____________ is no longer a consideration for alimony. correct
answers Fault
_____________________ are the first place to look to discover
hidden assets. It is a good idea to review all tax returns for the
past five years. correct answers Tax returns
______________________ are the testimony of a witness taken
out of court under oath and reduced to writing after discovery
and prior to trial. The ____________________________ may be
used to discredit a witness if he changes his testimony during
trial. correct answers depositions, deposition
3- to 7-year vesting (7-year graded vesting) correct answers An
employee who has completed at least three years of service must
have a non-forfeitable right to at least the following percentages
of his or her accrued benefit: 20% after three years of service,
40% after four years of service, 60% after five years of service,
80% after six years of service, and 100% after seven years of
service [IRC §411(a)(2)(B)].
5-year cliff vesting correct answers An employee who has at
least five years of service must have a non-forfeitable right to
100% of the employee's accrued benefit [IRC §411(a)(2)(A)].
A _______________________ tax carryforwards affects the
basis of an asset upon transfer in a divorce. correct answers
passive activity loss
,A CDFA professional's work product is never protected by
attorney-client privilege when working in a
__________________________. correct answers pro se divorce
A loss on the sale of a primary residence or personal vacation
property _____________________ deductible. If the vacation
property is a rental instead of for personal use, then the loss
__________________________. correct answers would not be,
would be deductible
A net operating loss _________________ affect the basis of the
business. correct answers does not
A taxpayer filing as Married Filing Separately does not qualify
for the __________________ credit. correct answers childcare
A valid prenuptial agreement __________________ waive
either party's right to apply for and receive Social Security
benefits. correct answers cannot
According to statistics, approximately how many divorce cases
use the "pro se" approach to settlement? correct answers 50%
Accountant correct answers An __________________ is a
person who is qualified to keep, audit, and inspect the financial
records of individuals or business concerns and prepares
financial and tax reports.
Acting as an __________________________ provides a
measure of privilege. correct answers attorney's consultant
,Actuary correct answers An ___________ is a person whose
work is to calculate statistically risks, premiums, and life
expectancies for insurance and pension plans.
Additionally correct answers Section 71 requires that if the
payor of alimony wants to deduct alimony payments over
$15,000 per year, payments must last for at least three years. If
this requirement is not met, payments are subject to recapture
rules.
An _________________________ is not an advocate.
________________________ is the advocate. correct answers
expert witness, your client's attorney
An immediate distribution may or may not be referenced in the
QDRO but it is ___________________________. correct
answers not a requirement
Appraisal correct answers ______________________ is the
procedure for determining the fair market value of an asset when
it is to be sold or divided as part of the divorce process.
Arbitration correct answers _________________ is submitting
a disputed matter for decision to a person who is not a judge.
The decision of an arbitrator is usually binding and final.
Arbitration varies greatly from mediation.
Arrearages correct answers The difference between the amount
of spousal or child support paid, if any, and the amount required
under court order.
, As the interest rate _____________________, the present value
of the pension will decline, and as the interest rate
___________________, the value of the pension will increase.
correct answers increases, declines
Asset Inventory correct answers ____________________ is a
collection of financial data that includes information on assets
and liabilities. Key documents used are the Financial Affidavit
and Asset and Liability Comparison worksheet.
Assets correct answers ________________ are cash, property,
investments, goodwill, and other items of value (as defined by
state law) that appear on a balance sheet indicating the net worth
of an individual or a business.
Assume that Tom violates the Six-Month Rule by stopping
spousal support payments to Eva the year that Grayson reaches
emancipation age. When will re-characterization of the spousal
support payments take effect? correct answers Retroactive to
the beginning of the spousal support payments.
Attorney correct answers An ________________ person who is
legally qualified and licensed to represent a person in a legal
matter, such as a transaction or lawsuit.
Attorneys are also cognizant of _____________________ in
each jurisdiction (or county) that the court or judges commonly
use. correct answers local customs
Solutions
____________ is no longer a consideration for alimony. correct
answers Fault
_____________________ are the first place to look to discover
hidden assets. It is a good idea to review all tax returns for the
past five years. correct answers Tax returns
______________________ are the testimony of a witness taken
out of court under oath and reduced to writing after discovery
and prior to trial. The ____________________________ may be
used to discredit a witness if he changes his testimony during
trial. correct answers depositions, deposition
3- to 7-year vesting (7-year graded vesting) correct answers An
employee who has completed at least three years of service must
have a non-forfeitable right to at least the following percentages
of his or her accrued benefit: 20% after three years of service,
40% after four years of service, 60% after five years of service,
80% after six years of service, and 100% after seven years of
service [IRC §411(a)(2)(B)].
5-year cliff vesting correct answers An employee who has at
least five years of service must have a non-forfeitable right to
100% of the employee's accrued benefit [IRC §411(a)(2)(A)].
A _______________________ tax carryforwards affects the
basis of an asset upon transfer in a divorce. correct answers
passive activity loss
,A CDFA professional's work product is never protected by
attorney-client privilege when working in a
__________________________. correct answers pro se divorce
A loss on the sale of a primary residence or personal vacation
property _____________________ deductible. If the vacation
property is a rental instead of for personal use, then the loss
__________________________. correct answers would not be,
would be deductible
A net operating loss _________________ affect the basis of the
business. correct answers does not
A taxpayer filing as Married Filing Separately does not qualify
for the __________________ credit. correct answers childcare
A valid prenuptial agreement __________________ waive
either party's right to apply for and receive Social Security
benefits. correct answers cannot
According to statistics, approximately how many divorce cases
use the "pro se" approach to settlement? correct answers 50%
Accountant correct answers An __________________ is a
person who is qualified to keep, audit, and inspect the financial
records of individuals or business concerns and prepares
financial and tax reports.
Acting as an __________________________ provides a
measure of privilege. correct answers attorney's consultant
,Actuary correct answers An ___________ is a person whose
work is to calculate statistically risks, premiums, and life
expectancies for insurance and pension plans.
Additionally correct answers Section 71 requires that if the
payor of alimony wants to deduct alimony payments over
$15,000 per year, payments must last for at least three years. If
this requirement is not met, payments are subject to recapture
rules.
An _________________________ is not an advocate.
________________________ is the advocate. correct answers
expert witness, your client's attorney
An immediate distribution may or may not be referenced in the
QDRO but it is ___________________________. correct
answers not a requirement
Appraisal correct answers ______________________ is the
procedure for determining the fair market value of an asset when
it is to be sold or divided as part of the divorce process.
Arbitration correct answers _________________ is submitting
a disputed matter for decision to a person who is not a judge.
The decision of an arbitrator is usually binding and final.
Arbitration varies greatly from mediation.
Arrearages correct answers The difference between the amount
of spousal or child support paid, if any, and the amount required
under court order.
, As the interest rate _____________________, the present value
of the pension will decline, and as the interest rate
___________________, the value of the pension will increase.
correct answers increases, declines
Asset Inventory correct answers ____________________ is a
collection of financial data that includes information on assets
and liabilities. Key documents used are the Financial Affidavit
and Asset and Liability Comparison worksheet.
Assets correct answers ________________ are cash, property,
investments, goodwill, and other items of value (as defined by
state law) that appear on a balance sheet indicating the net worth
of an individual or a business.
Assume that Tom violates the Six-Month Rule by stopping
spousal support payments to Eva the year that Grayson reaches
emancipation age. When will re-characterization of the spousal
support payments take effect? correct answers Retroactive to
the beginning of the spousal support payments.
Attorney correct answers An ________________ person who is
legally qualified and licensed to represent a person in a legal
matter, such as a transaction or lawsuit.
Attorneys are also cognizant of _____________________ in
each jurisdiction (or county) that the court or judges commonly
use. correct answers local customs
