REG Study Group – Q2 2018 - Page 16

@jsdailey


@Dev12

I am in the same boat as you guys. I feel great about MCQ, but SIMS are another story. I'm going to continue to practice them until test day (5/31)

For those supplementing with Gleim TB for REG – are you struggling on these questions as well? Their questions are no joke and require a MUCH deeper level understanding than any of the questions I've completed in Becker.

Let’s test our knowledge—REG AMOUNT!

There is $2,600 (indexed for inflation) something.

Does anyone know?

@Lexi:
Correct.
Employees have the ability to elect to have part of the salary (generally up to $2,600 per year) deposited pretax into a flexible spending account designated for them
————————————————–
Important Components of the FSA Contribution Limit:
•The FSA limit applies only to employee pre-tax contributions (now $2,600 for 2017). Employer contributions can be in excess of the limit
•The FSA limit increase is effective for FSA plan years beginning on or after January 1, 2017
•The limit is based on the employee and not the household. If an employee and spouse both have access to their own FSA through their own respective employers, they are each eligible to contribute the full $2,600 maximum

Kiddie tax!

Kiddie Tax: The Net Unearned Income of a dependent child (a) under 18, or (b) between 18-24 who does not provide over half of his own support and is a full-time student is taxed at the parent’s higher tax rate. Examples of which are: 4 [RIDeR] R – Royalty, I – Interest, D – Dividends, e, R – Rent, with totals subtracting $2,100: The child’s allowable SD of $1,050 (or investment expense, if greater) + additional $1,050 (that is taxed at child’s rate). Although the income in excess of $2,100 is taxed at parent’s rate, it is nonetheless reported at the child’s TR. Parents may elect to include on their own return the unearned income of the applicable child provided that the income is between $1,050 and $10,500 and consists solely of interest, dividends, and capital gains distributions.

oh this one I know the number just because I got it wrong so many time lol. Wages over $7K for household employees aren't taxed. I still get confused though. Here is what I get:
If wages paid are $2,000 or more for the year you withhold SS and Medicare. (7.65% employee and 7.65% employer)
If wages paid are $1,000 or more in a calendar quarter you pay federal unemployment tax of 6% (plus state if needed)
and if wages are over $7K they are not taxed…so no one pays anything here??
Also, some of the ninja mcq's have that employees can make the choice if to have it withheld or not, still not sure about this…

how to ace authoritative literature SIMS ?