United States Persons
KNOWLEDGE EXPECTED OF: CFP® Professionals
Highest Knowledge Level: Understanding
Knowledge Levels and Associated Verbs
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Awareness
The state of being aware that something exists / to have familiarity with a particular activity or subject
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Understanding
To comprehend the general relationship of particulars / to have an expertise with how something works
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Application
Ability to put information to use / to use knowledge for relevant, practical purposes
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Evaluation
To judge or conclude by utilizing data / a systematic determination of something’s worth or significance
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Define
To state exactly the meaning of
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Identify
To be aware of / to recognize and correctly name / to locate an appropriate resource
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Explain
To make clear the meaning of / to describe something in more detail or reveal relevant facts or ideas related to it
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Determine
To ascertain / to come to a decision, such as by investigation or reasoning
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Compare
To note the similarities and differences between two or more things
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Estimate
To determine an approximate value for
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Calculate
To find the value using mathematics
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Convert
To change from one form or purpose to another
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Evaluate
To reach a conclusion or make a through careful study
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Interpret
To give the meaning of / to construe or understand / to translate orally
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Hold cursor over or click on each term to read its definition.
Additional Knowledge Expected of CFP Professionals
- Identify that income tax obligations in the United States are based on citizenship and residency status.
- Identify that residency is established on a case-by-case basis.
- Define a “United States Person” under the Internal Revenue Code of the United States.1
- Define an “Alien” for United States taxation purposes.2
- Explain the tests for determining if an individual is a United States resident for income tax purposes.
- Green card test3
- Substantial presence test4
- Explain requirements for an individual who qualifies as a resident of the United States under the substantial presence test to be deemed to be a non-resident due to a “closer connection” to another country.5
- Identify factors that may establish that an individual has a closer connection to a country outside of the United States.6
- Identify that United States persons are required to pay tax on their worldwide income.
- Identify that United States persons may be required to file an annual tax return with the Internal Revenue Service (IRS).
