CPB CPB Tax Planning & Optimization 3

Question 1

What is a Qualified Opportunity Zone (QOZ) investment primarily designed to provide?

Accepted Answer

Tax-advantaged investment in designated economically distressed communities

Answer

A government bond with tax-exempt interest

Answer

A real estate investment trust with diversified holdings

Answer

A foreign investment vehicle with treaty benefits

Question 2

Which depreciation system accelerates tax deductions more heavily in the early years of a business asset's life?

Accepted Answer

Modified Accelerated Cost Recovery System (MACRS)

Answer

Straight-line depreciation

Answer

Units of production method

Answer

Sum-of-years digits method

Question 3

What is the primary tax benefit of a Charitable Remainder Trust (CRT) for a high-net-worth private banking client?

Accepted Answer

An income stream for the donor plus an immediate partial charitable deduction

Answer

Full asset protection from creditors and lawsuits

Answer

Completely tax-free inheritance for heirs

Answer

Total avoidance of capital gains on sale of appreciated assets

Question 4

Which IRS provision allows owners of pass-through businesses to potentially deduct up to 20% of qualified business income (QBI)?

Accepted Answer

Section 199A deduction

Answer

Section 179 expensing deduction

Answer

Section 1202 gain exclusion

Answer

Section 1245 depreciation recapture

Question 5

What is the tax strategy known as 'bunching' used to accomplish?

Accepted Answer

Concentrating deductible expenses into one tax year to exceed the standard deduction threshold

Answer

Combining multiple investments into a single diversified portfolio

Answer

Grouping passive activity losses to maximize deductibility

Answer

Consolidating multiple retirement accounts for simplified RMD calculation

Question 6

A Spousal Lifetime Access Trust (SLAT) allows a married couple to:

Accepted Answer

Utilize the lifetime gift tax exemption while the non-donor spouse retains indirect access to trust assets

Answer

File tax returns jointly at a lower combined rate

Answer

Avoid probate entirely on all marital assets

Answer

Transfer IRA and 401(k) assets to heirs without income tax