Tax, Bankruptcy and Financial Problems

19 Credits: Taxes


Webcasts are available for viewing Monday – Saturday, 8am – 8pm ET.
Without FlexCast, you must start with enough time to finish. (1 Hr/Credit)

 Secure Transaction

Tax, Bankruptcy and Financial Problems

Course Level
CPE Credits

19 Credits: Taxes

Course Description

This insightful online self study course is tailored to equip professionals with the skills to effectively manage the intricate aspects of tax, bankruptcy, and financial issues. It delves into the strategic tax implications of bankruptcy and property settlements, teaching how to handle debt cancellation and foreclosure scenarios adeptly. Participants will gain a thorough understanding of asset protection strategies, repossession processes, and managing bad debts. The course also focuses on eldercare and estate planning, providing a holistic view of financial management. Key topics include an in-depth analysis of the cancellation of indebtedness income inclusion rules and their exceptions under §108, along with the tax treatment of property repossession under §1038. By applying these concepts through practical case studies, participants will enhance their ability to make strategic decisions in complex financial situations, adding significant value to their professional roles.

Show More
Show Less

Learning Objectives

Upon successful completion of this course, participants will be able to:

Chapter 1

  • Determine how the 2005 Bankruptcy Act changed procedures, qualifications, and tax law, and identify the most common bankruptcy types recognizing their influence on how an individual or business “goes bankrupt.”
  • Specify the rules for automatic stay and levy identifying their impact on “freezing” creditor activity, tax assessment, and collection.
  • Identify the differences between preferential and nonpreferential payments specifying the priority of creditor claims.
  • Recognize when debt is discharged under various bankruptcy types and identify how to establish an individual bankruptcy estate determining its taxable income and filing requirements.
  • Identify partnership and corporate bankruptcies, specify debts covered under homesteading, and determine permissible garnishment amounts and special garnishment rules.

Chapter 2

  • Identify forms of marital property stating their likely division in marital property settlements and specify the legal principles used in dividing assets and providing support on divorce or separation.
  • Recognize the benefits of premarital agreements in avoiding potential divorce problems, determine elements of the Uniform Premarital Act, and list the provisions that are allowed in such agreements.
  • Determine the tax consequences of various property settlements by:
    • Identifying the requirements of §1041 stating how it changed the result of S. v. Davis and their application to common interspousal transfers;
    • Specifying factors that influence whether a property transfer is “incident to divorce” identifying how to meet these factors or avoid §1041 altogether;
    • Recognizing the treatment of transfers in trust under §1041(e), and specifying the tax treatment of third party transfers on behalf of a spouse or former spouse;
    • Determining property basis as a result of §1041 transfers applying §1041 where the transferee assumes liabilities encumbering the property; and
    • Identifying the holding period for assets transferred between spouses incident to divorce.
  • Specify the dangers of interspousal purchases including deferred tax liability, determine three effects of purchasing an interest in tangible personal property or real property used in a trade or business or held for investment, and identify potential depreciation recapture.
  • Determine the tax consequences of selected asset divisions incident to divorce and those that follow bankruptcy.

Chapter 3

  • Recognize the goals and purposes of asset protection and the objections about shielding assets from creditors by:
    • Specifying reasons for asset protection and situations that can unexpectedly put assets and financial security at stake;
    • Identifying common sources of lawsuits and the concepts of exploding and imploding liability; and
    • Determining how insurance, asset placement, and statutory protections can help achieve asset protection.
  • Identify the types of creditors associated with asset protection and fraudulent transfers.
  • Determine fraudulent transfer identifying badges of fraud, statutes of limitation, and criminal penalties, and specify permissible asset transfers.
  • Recognize the necessity of asset protection identifying net worth under a balance sheet, and determine asset values in the preparation of a balance sheet.
  • Identify how insurance and buy-sell agreements can offer asset protection by:
    • Determining the asset protection elements of homeowner’s, automobile, and disability insurance;
    • Specifying the parties under a life insurance contract listing and reasons for establishing an irrevocable life insurance trust; and
    • Determining what constitutes entity purchase and cross-purchase buy-sell
  • Recognize the asset protection advantages and disadvantages of ownership formats and entities by:
    • Citing the use of individual ownership and corporate ownership in an asset protection plan, the importance of S corporations and their estate tax planning advantages;
    • Identifying testamentary trusts, living trusts, their subcategories, and asset protection elements;
    • Specifying the types of co-tenancy and their asset protection dangers, and identifying types of partnerships and their variation from limited liability companies; and
    • Recognizing the unique asset protection qualities of retirement plans, custodianship, and estates as asset protection tools.

Chapter 4

  • Identify deductible §213 medical care expenses for federal tax purposes by:
    • Recognizing the potential inclusion of spousal and dependent expenses, medical insurance premiums, meals and lodging, transportation expenses, cosmetic surgery, permanent home improvements, and lifetime care payments;
    • Determining what constitutes medical savings accounts and their differences with health savings accounts, and citing the benefits and qualifications of HSAs including their relationship with high deductible health plans; and
  • Specifying the mechanics of prescription drug plans, and identifying the accelerated death benefits exclusion and the health insurance deduction for self-employed individuals.
  • Cite variables that impact the deductibility of §170 charitable contributions recognizing qualified organizations and limitations for these purposes, and identify the types of contributions that can be made, their tax treatment, and substantiation requirements.
  • Determine what constitutes a §165 casualty or theft and the former and current rules for taking a deduction for all or part of each loss.

Chapter 5

  • Recognize the effect that debt cancellation has on net worth and potential income inclusion from cancellation of indebtedness income, and identify exceptions to the general income inclusion rule and their tax effect.
  • Specify the reduction of tax attributes on cancellation identifying any special basis reduction rules, recognize the depreciable property election, and determine what constitutes individual, partnership, and S corporation bankruptcies and the variables used in characterizing shares as nominal or token.
  • Determine gain or loss resulting from foreclosure or repossession including its timing and character, identify reporting and filing requirements of such items, and specify the tax danger of acquiring one’s own debt at a discount.

Chapter 6

  • Select which §1038 repossession rules apply to a transaction, and determine basis and gain or loss resulting from repossession of personal property using installment and non-installment methods of sale.
  • Identify the distinctions between the rules, calculations, and effects of repossessions of personal and real property, and specify when a §166 bad debt deduction may be taken if the seller repossesses real property.

Chapter 7

  • Determine bad debt categories, their tax treatment, and effect on accounting and reporting by:
    • Recognizing the concepts of worthlessness and true debt specifying the unique characteristics of deductible nonbusiness bad debt;
    • Identifying the treatment of bad debts related to political debts, mechanics’ liens, and secondary liabilities on home mortgages; and
    • Specifying the forms used to report bad debts and the tax treatment of recovered amounts.
  • Identify the qualifications for §166 tax treatment of business bad debts by:
    • Recognizing the tax treatment of business credit transactions, loan guarantees, accounts receivable, or notes receivable including the tax treatment of accounts receivable in a sale and specifying the various forms on which a bad debt deduction should be taken based on entity type;
    • Determining the tests to be met by an accrual method business in taking a bad debt deduction for a political debt and specifying the tax consequences of the insolvency of a partner when a partnership terminates with debts owed; and
    • Identifying methods that can be used by businesses to treat uncollectible amounts and the rules that apply to each.

Chapter 8

  • Specify ways to manage an incompetent person’s estate, recognize joint tenancy and its benefits, and identify the levels of conservatorship that can influence assistance in the management and protection of an estate and/or personal care.
  • Recognize durable powers and funded revocable living trusts and their uses and limitations in elderly and disabled planning.
  • Identify the eldercare benefits of Medicare and Medicaid, countable income, and asset groupings under Medicaid.
  • Determine available health care decisions such as having a living will, identify the distinctions between Supplemental Security Income and Social Security disability benefits, determine SSI asset groups, and specify requirements for SSI and Social Security disability benefits.

Chapter 9

  • Determine what constitutes estate planning for clients by:
    • Identifying the elements of estate tax planning that have remained unchanged by recent legislation;
    • Recognizing the unlimited marital deduction and its effect on the gross estate of the value of property; and
    • Specifying the applicable exclusion amounts for various years of death.
  • Identify the concepts of “stepped-up basis” and “modified carryover basis” for estate tax purposes.
  • Specify estate planning goals, and recall the benefits and drawbacks of the primary dispositive plans.
  • Identify various types of estate trusts and the family documents that every taxpayer should consider, and determine the advantages and disadvantages of the former private annuity format.
Show More
Show Less

Course Specifics

Course ID
Revision Date
August 11, 2023

General understanding of federal income taxation.

Advanced Preparation


Number of Pages

Compliance Information

NASBA Provider Number: 103220
IRS Provider Number: 0MYXB
IRS Course Number: 0MYXB-T-02184-22-S
IRS Federal Tax Law Credits: 19
CTEC Provider Number: 2071
CTEC Course Number: 2071-CE-1636
CTEC Federal Tax Law Credits: 19

CFP Notice: Not all courses that qualify for CFP® credit are registered by Western CPE. If a course does not have a CFP registration number in the compliance section, the continuing education will need to be individually reported with the CFP Board. For more information on the reporting process, required documentation, processing fee, etc., contact the CFP Board. CFP Professionals must take each course in it’s entirety, the CFP Board DOES NOT accept partial credits for courses.

CTEC Notice: California Tax Education Council DOES NOT allow partial credit, course must be taken in entirety. Western CPE has been approved by the California Tax Education Council to offer continuing education courses that count as credit towards the annual “continuing education” requirement imposed by the State of California for CTEC Registered Tax Preparers. A listing of additional requirements to register as a tax preparer may be obtained by contacting CTEC at P.O. Box 2890, Sacramento, CA, 95812-2890, by phone toll-free at (877) 850-2832, or on the Internet at

Meet The Experts

Danny Santucci, BA, JD, is a prolific author of tax and financial books and articles. His legal career started with the business and litigation firm of Edwards, Edwards, and Ashton. Later he joined the Century City entertainment firm of Bushkin, Gaims, Gaines, and Jonas working for many well-known celebrities. In 1980, Danny established the law firm of Santucci, Potter, and Leanders in Irvine, California. With increasing lecture and writing commitments, Danny went into sole practice in 1995. His practice emphasizes business taxation, real estate law, and estate planning. Speaking to more than 100 groups nationally each year, he is known …