REG Study Group – Q2 2018 - Page 3

I am taking exam on 4/30, it's my retake. I am using Wiley (mainly on Wiley), then Roger, and the last is Becker. I only study Wiley textbook and study Ninja note.
It's a lot, but, I need to pass this one.

A CPA assists a taxpayer in tax planning regarding a transaction that meets the definition of a tax shelter as defined in the Internal Revenue Code. Under the AICPA Statements on Standards for Tax Services, the CPA should inform the taxpayer of the penalty risks unless the transaction, at the minimum, meets which of the following standards for being sustained if challenged?

A. More likely than not.
B. Not frivolous.
C. Substantial authority.
D. Realistic possibility.

This question is interesting. I didn't see in Becker that info. Employer should keep info of his employed tax return preparers for 2 years 🙂

Which of the following is false regarding the filing of information returns concerning employees who prepare tax returns?

A. Annual listings of preparers, identification numbers, and place of work are required for preparers who employ others to prepare returns.
B. No information return is actually required to be submitted; a list is made and kept by the employing preparer.
C. The period for which the information return is required is a 12-month period beginning July 1 of each year.
D. Information returns of income tax return preparers must be maintained by the preparer for 2 years.

Answer (D) is correct.
Under Sec. 6060(a), a person who employs one or more tax return preparers to prepare a return or claim for refund must file a return setting forth the name, identifying number, and place of work of each income tax return preparer employed by him or her. Section 6060(b) allows the IRS to approve an alternative method of reporting. Regulation 1.6060-1 states that the requirements of Sec. 6060 are satisfied by retaining a record of the name, identifying number, and principal place of work of each income tax return preparer employed and by making that record available for inspection upon request by the commissioner for the 3-year period following the close of the return period to which that record relates. The return period means the 12-month period beginning July 1 of each year [Reg. 1.6060-1(b)].

Can someone help me below question? (Partnership question from Wiley)
12/31/2016, L&E were equal partners in a partnership with net assets having a tax basis and FMV of $150,000. On 1/2/2017, G contributed securities with FMV of $75,000 (purchased in 2012 at a cost of $51,000) to become an equal partner in the new firm. The securities were sold on 7/1/2017 for $78,000 .How much of the partnership's gain from the sale of these securities should be allocated to G?

The answer is $25,000

Thank you for help

@kloss The difference btw the FMV and NBV of the asset is a built in gain to the contributing partner (51-75 ='s $24000). The remaining gain is split btw the 3 partners (51 – 78 = 27 – 24 = 3 ) $1,000 to each partner. So the contributing partners total gain is $25,000

Just scheduled REG for June 9th at 8:30 AM! This is the last exam I need to pass and I need to pass it by January. I've never taken REG before and I passed the other three on my second try, so hopefully I can pass REG on the first try unlike the other three. I will start studying as soon as busy season ends. Glad I found this forum! I'll probably use it as I'm studying.

Another72 I think if you averaging 80s on ninja- you are more than fine. Focus on tax now.