CDA Financial Planning & Property Division 3

Question 1

Which concept allows a spouse to claim Social Security benefits based on an ex-spouse's earnings record if the marriage lasted at least 10 years?

Accepted Answer

Divorced spousal benefit

Answer

A divorced spouse may claim up to 50% of the ex-spouse's Social Security benefit if married for 10+ years, divorced for 2+ years, and currently unmarried.

Question 2

When dividing a traditional IRA in divorce, which transfer method avoids triggering taxes and the 10% early withdrawal penalty?

Accepted Answer

Transfer incident to divorce

Answer

An IRA transfer incident to divorce, completed via a trustee-to-trustee transfer as specified in the divorce decree, moves funds tax-free without penalty.

Question 3

In community property states, which of the following assets acquired during marriage is generally classified as separate property?

Accepted Answer

A gift received by one spouse from a third party

Answer

Gifts received by one spouse from a third party during the marriage remain separate property even in community property states, as they were not earned through the marital partnership.

Question 4

What financial planning tool calculates the after-tax, after-cost present value of each asset to make true 'apples-to-apples' comparisons in divorce settlements?

Accepted Answer

Asset comparison worksheet

Answer

An asset comparison worksheet adjusts each asset's gross value for taxes, penalties, and transaction costs, revealing its true net value for equitable comparison.

Question 5

What is 'transmutation' in the context of divorce property law?

Accepted Answer

The change of property from separate to marital or vice versa

Answer

Transmutation occurs when property changes its classification from separate to marital (or reverse), often through commingling, titling changes, or written agreement.

(CDA) Certified Divorce Advisor Practice Test

(CDA) Certified Divorce Advisor Practice Test

CDA Financial Planning & Property Division 3