[jeff]

NINJA Study Notes, Flashcards, and Audio: https://www.another71.com/products-page/

Wiley Software: https://www.another71.com/wiley-cpa-software/

Jeff Elliott, CPA (KS) | Another71 | NINJA CPA | NINJA CMA | NINJA CPE

[sboggs74]

@nolifecpa,

No!! That's why I was so confused! There were four questions that were exactly the same but different numbers…..

[nolifecpa]

@sboggs74

can you post the answers and the explainations for that question?

REG-65,71,74,73,70,74,79
BEC-60's,60's,69,71,76*,78
FAR-67,66,65,79
AUD-54,60's,65,83*,69,80
*expired

DONE

[musicamor]

@nolife and @sboggs…if the question doesn't explicitly say property, then the distribution must be considered cash; so the answer to that question is the land would have a zero basis.

Texas CPA - licensed in 2012!!!

[HustlinHustlin]

Does anyone have a good way to remember what all gets added/substracted on the M-1? I also am struggling with formation of a corporation gain/loss and basis to shareholder and corporation!

B 71 - 79 EXPIRED
A 69 - 75 EXPIRED
R 65 - 48 - 45
F 56 - 61 - 65 - 64

Becker, Wiley Test Bank, Wiley Text and Ninja Notes

"The fish who keeps on swimming is the first to chill upstream" -311

Experience - Done, like WAAAY done.
Still need 30 more credits, in basket weaving (gotta love new CA requirements)

[mena je twa]

Hustlin..

What review course are you using? This should be the basic information that should be in any review.

I passed Regulation some time ago…. I remember some stuff, but not every little detail….

Licensed CPA, Texas - 2012

[HustlinHustlin]

I'm using Becker. It does go over it, but there's no easy way for me to memorize all of it. I keep having to refer to the book. REG is throwing me a curveball because I don't know what is vital and what isn't…

B 71 - 79 EXPIRED
A 69 - 75 EXPIRED
R 65 - 48 - 45
F 56 - 61 - 65 - 64

Becker, Wiley Test Bank, Wiley Text and Ninja Notes

"The fish who keeps on swimming is the first to chill upstream" -311

Experience - Done, like WAAAY done.
Still need 30 more credits, in basket weaving (gotta love new CA requirements)

[musicamor]

@HustlinHustlin–I don't know of an “easy” way to learn the M-1 adjustments, per se. What I have found particulary helpful is memorizing the permanent differences–since there are less of them–and that way if I don't see a perm difference then I know it's a temporary difference; I can then navigate my way through the question. Obviously, perm differences (from FAR) are nontaxable income like interest on muni bonds or key-man life insurance proceeds, federal income tax, etc. Temporary differences are MACRS depreciation, prepaid expenses, organizational costs, etc.

As far as formation of a corporation, if the shareholder(s) are in control of the corp to the extent of 80% immediately after formation, then the shareholder(s) nor the corporation recognize any gain or loss (generally). You always use the adjusted basis of the property being contributed in the calculation. If liabilities assumed by the corp exceed the adjusted basis of the property being contributed, then there is a gain to the shareholder. The basis of the property to the corp is the adjusted basis in the hands of the shareholder plus any gain recognized upon formation.

Texas CPA - licensed in 2012!!!

[mena je twa]

Hustlin, it was tough for me too….. I used yaeger but still i had a hard time with them. Both of the questions you asked are a prime candidate for simulations and that was my downfall for the first 2 times in regulation.

I bought from ebay, craigs list – simulation startegies with Bisk, Bob Monette was the instructor and also i bought a C-Corp only disc, where he breaks down, each of these items in simple terms, DRD, charity, M1's all are broken down. Thats when it clicked .

He goes over 8 simulations, 2 of them on M-1s and corp, etc, there is no other way out, you have to understand or memorize them.

Just imagine out of the 6 tabs on simulations what if 1 tab is on formation of C-Corp, and other one is on M-1? You will be at a disadvantage right away.

Licensed CPA, Texas - 2012

[HustlinHustlin]

Thanks for the advice. It will take practice, I suppose.

B 71 - 79 EXPIRED
A 69 - 75 EXPIRED
R 65 - 48 - 45
F 56 - 61 - 65 - 64

Becker, Wiley Test Bank, Wiley Text and Ninja Notes

"The fish who keeps on swimming is the first to chill upstream" -311

Experience - Done, like WAAAY done.
Still need 30 more credits, in basket weaving (gotta love new CA requirements)

[musicamor]

In the current year, Aaron was a full-time student. Aaron's father paid an amount equivalent to Aaron's tuition of $17,000 directly to Aaron who, then, remitted the funds to the school. Which is correct concerning the deductibility of the tuition paid by Aaron in the current year? Assume that the tuition paid is qualifying tuition expense.

A. Aaron cannot deduct the monies paid to the educational institution because Aaron received those monies as a gift from his father.

B. Aaron can take this tuition payment as an itemized deduction

C. Since Aaron would not be taxed on the gift from his father, Aaron can deduct the $17,000 paid to the educational institution as an adjustment to Gross Income to arive at Adjusted Gross Income

D. Aaron's father can take the deduction from Gross Income to arrive at Adjusted Gross Income.

HELP!! Wiley says “C” is the correct answer but Aaron got monies as a gift from his Father! I guess Aaron could prove that the tuition was paid via other monies that did not come directly from his father???

Texas CPA - licensed in 2012!!!

[musicamor]

Another puzzling REG question from CPAReviewForFree.com:

Donald is in possession of a K-1 from a limited partnership in which he was a limited partner. The limited partnership interest was traded on a national stock exchange and registered with the SEC under the 1934 Act. If the K-1 received by Donald reflects a loss, which of the following is correct?

A. Donald cannot recognize this loss on his current year Individual Income Tax Return

B. Donald can recognize this loss on his current year Individual Income Tax Return

C. Donald can recognize $3,000 of the loss reported on the K-1 and carry the rest of the loss forward indefinitely

D. None of these options is correct

I'm totally lost on this: Wiley says B is correct!! I thought Passive Activity Losses are not recognizable against ordinary income?

Texas CPA - licensed in 2012!!!

[nolifecpa]

@musicamor

i love the questions cuz it make me think as well

question 1:

c is correct, gifts are taxed to the person “giving” the gift, not persons receiving the gift. the money is used to pay tuition which aaron can receive a deduction for AGI (line 34 on form 1040)

a is incorrect, there is no restrictions on deducting tuition just because it was a gift

b is incorrect, tuition deduction is not an itemized deduction

d is incorrect, the question just says aarons father gave him money, didn't say gave money for tuition. even if aaron's father wanted to deduct for tuition he would have to pay the school directly instead of giving it to aaron

question 2:

b is correct, donald can “RECOGNIZE” the loss but can not “REALIZE” the loss. donald has to offset the PAL with PAIncome

a is incorrect, same explaination as b

c is incorrect, 3000 is for capital g/l

d is incorrect, b is correct

let me know if that helps, anybody chime in if i'm wrong

REG-65,71,74,73,70,74,79
BEC-60's,60's,69,71,76*,78
FAR-67,66,65,79
AUD-54,60's,65,83*,69,80
*expired

DONE

[nolifecpa]

what is M and G basis in stock if

M contributes

noncash property FMV: 80,000

liab on property: 50,000

basis of property: 40,000

cash: 20,000

G contributes

noncash property FMV: 70,000

liab on property: 0

basis of property: 50,000

cash: 0

G also received 20,000 cash

REG-65,71,74,73,70,74,79
BEC-60's,60's,69,71,76*,78
FAR-67,66,65,79
AUD-54,60's,65,83*,69,80
*expired

DONE

[Anonymous]

So I took REG for the first time today. First testlet was obviously medium, It was definitely doable. Second testlet was the hardest I've probably ever seen. II was worried about timing so I had to straight up guess on several. Last testlet was definitely medium. I knew it was medium because there was one question that was the same, verbatim from the first testlet. In addition the content was definately a step below the second testlet. Sims were obviously pretty difficult, some topics I had never even looked at.

My question is, can you still pass the exam with two medium testlets? I know the scoring is somewhat subjective but if anyone out there can share, I'm still pretty new to the CPA.

[musicamor]

@nolifecpa…thanks for your help on my question. Need more info on your question. Is this partnership or corp? If partnership, what share is this partner getting…if corp what % ownership will be had upon contribution?

@Allornothing, it seems like you may be okay on the MCQs because your second testlet increase in difficulty which means you did well on the first one. Getting a medium testlet after a hard testlet means that the second testlet wasn't so hot; I don't think that scraps your chances of passing. Sims will make a difference.

Texas CPA - licensed in 2012!!!

[Author]

Replies