[jeff]

REG Resources:

Free REG Notes & Audio – https://www.another71.com/cpa-exam-study-plan

REG 10 Point Combo: https://www.another71.com/products-page/ten-point-combo

REG Score Release: https://www.another71.com/cpa-exam-scores-results-release

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

[masterof74s]

Hey Everyone!

I just failed REG with a 74 (ugh!) in May, I am retaking it at the end of next week in hopes of boosting my score by that one extra point! Does anyone have a solid example of a Section 179 question?

AUD - 68, 74, 76 - DONE
BEC - 78 - DONE
REG - 52, 74, 74, 63, 74
FAR - 68, 78 - DONE

[masterof74s]

Hey Everyone!

I just failed REG with a 74 (ugh!) in May, I am retaking it at the end of next week in hopes of boosting my score by that one extra point! Does anyone have a solid example of a Section 179 question?

AUD - 68, 74, 76 - DONE
BEC - 78 - DONE
REG - 52, 74, 74, 63, 74
FAR - 68, 78 - DONE

[NikkiSkupnjak]

I don't have a specific example. But from what I know:

Section 179 you can expense up to $500,000. If you purchased over $2,000,000 in property that year, the $500,000 is reduced by the excess over $2 million.

Can anyone explain bonus depreciation? I don't understand when you can use it and how it compares to Section 179

From what I read

50% depreciation rate for assets placed in service before Sept. 9, 2010

100% for assets placed in service Sept. 9, 2010 – Dec. 31, 2011

50% for assets placed in service after Dec. 31, 2011

FAR 92
AUD 99
REG 94
BEC

Becker Self-Study, Wiley Test Bank

[NikkiSkupnjak]

I don't have a specific example. But from what I know:

Section 179 you can expense up to $500,000. If you purchased over $2,000,000 in property that year, the $500,000 is reduced by the excess over $2 million.

Can anyone explain bonus depreciation? I don't understand when you can use it and how it compares to Section 179

From what I read

50% depreciation rate for assets placed in service before Sept. 9, 2010

100% for assets placed in service Sept. 9, 2010 – Dec. 31, 2011

50% for assets placed in service after Dec. 31, 2011

FAR 92
AUD 99
REG 94
BEC

Becker Self-Study, Wiley Test Bank

[Heidi-O]

Masterof74s – That's Hateful!! I'm sorry you missed by one point, but, sadly, you are not alone.

For tax year 2013

According to CCH you are looking at two separate tax codes

First is Section 179 that states that you can deduct (expense) up to $500,000 in property for 2013 (which if the assets placed in service cost more 2,000,000, then the 500,000 gets reduced – I don't think the exam will go into that much detail, but just in case).

Second, the section 179 property that you just expensed part of then gets to use the application of Section 168(k). This gets applied AFTER section 179. This states that a “50% bonus depreciation allowance is then computed on the taxpayer's basis in the section 179 property as reduced by the Code section 179”.

So, you put a piece of manufacturing equipment in place that costs 700,000. You get 500,000 in Section 179 depreciation expense. This makes the basis in the equipment 200,000 (700 – 500). Next, you apply the 168(k) 50% reduction in basis on this piece of equipment and take and additional 100,000 (50% of 200,000 basis).

Again, as I understand it, that additional 50% deduction can ONLY be used on the equipment that you have used the Section 179 deduction on.

FAR Aug 2012 79
AUD Oct 2012 84
REG Aug 2013 87
BEC Jan 2013 80

[Heidi-O]

Masterof74s – That's Hateful!! I'm sorry you missed by one point, but, sadly, you are not alone.

For tax year 2013

According to CCH you are looking at two separate tax codes

First is Section 179 that states that you can deduct (expense) up to $500,000 in property for 2013 (which if the assets placed in service cost more 2,000,000, then the 500,000 gets reduced – I don't think the exam will go into that much detail, but just in case).

Second, the section 179 property that you just expensed part of then gets to use the application of Section 168(k). This gets applied AFTER section 179. This states that a “50% bonus depreciation allowance is then computed on the taxpayer's basis in the section 179 property as reduced by the Code section 179”.

So, you put a piece of manufacturing equipment in place that costs 700,000. You get 500,000 in Section 179 depreciation expense. This makes the basis in the equipment 200,000 (700 – 500). Next, you apply the 168(k) 50% reduction in basis on this piece of equipment and take and additional 100,000 (50% of 200,000 basis).

Again, as I understand it, that additional 50% deduction can ONLY be used on the equipment that you have used the Section 179 deduction on.

FAR Aug 2012 79
AUD Oct 2012 84
REG Aug 2013 87
BEC Jan 2013 80

[Heidi-O]

Oh, and just in case they ask on the exam “Section 179 deduction that may be claimed in a tax year (section 179(b)(3)(A)…. may not exceed the taxable income derived by the taxpayer from the active conduct of any trade or business during the tax year. The amount elected to be expensed that is disallowed as a deduction under the taxable income limitation may be carried forward. (section 179(b)(3)(B)”

Again, just remember that 179 deduction cannot create a loss, and that the 179 amount allowed in that year can be carried forward.

FAR Aug 2012 79
AUD Oct 2012 84
REG Aug 2013 87
BEC Jan 2013 80

[Heidi-O]

Oh, and just in case they ask on the exam “Section 179 deduction that may be claimed in a tax year (section 179(b)(3)(A)…. may not exceed the taxable income derived by the taxpayer from the active conduct of any trade or business during the tax year. The amount elected to be expensed that is disallowed as a deduction under the taxable income limitation may be carried forward. (section 179(b)(3)(B)”

Again, just remember that 179 deduction cannot create a loss, and that the 179 amount allowed in that year can be carried forward.

FAR Aug 2012 79
AUD Oct 2012 84
REG Aug 2013 87
BEC Jan 2013 80

[NikkiSkupnjak]

@Heidi-O THANK YOU!

FAR 92
AUD 99
REG 94
BEC

Becker Self-Study, Wiley Test Bank

[NikkiSkupnjak]

@Heidi-O THANK YOU!

FAR 92
AUD 99
REG 94
BEC

Becker Self-Study, Wiley Test Bank

[Heidi-O]

@Nikki Glad I could help!

I have been doing the hand written notes for a few weeks. I've made it through chapter 3 and then I put them in a Word document. I WILL get beyond this stupid text anxiety. The only additional chapter I plan to write up notes for is Chapter 4 Partnerships. It is working, as the information is being pounded into my brain – lets hope it is easily retrieved on test day 7/18.

I think I will give my hand a break and focus on contract law instead. It will be easier to knock out 5 and 6 (and possibly 7) and then go back to chapter 4 and start the handwritten and typed notes again.

FAR Aug 2012 79
AUD Oct 2012 84
REG Aug 2013 87
BEC Jan 2013 80

[Heidi-O]

@Nikki Glad I could help!

I have been doing the hand written notes for a few weeks. I've made it through chapter 3 and then I put them in a Word document. I WILL get beyond this stupid text anxiety. The only additional chapter I plan to write up notes for is Chapter 4 Partnerships. It is working, as the information is being pounded into my brain – lets hope it is easily retrieved on test day 7/18.

I think I will give my hand a break and focus on contract law instead. It will be easier to knock out 5 and 6 (and possibly 7) and then go back to chapter 4 and start the handwritten and typed notes again.

FAR Aug 2012 79
AUD Oct 2012 84
REG Aug 2013 87
BEC Jan 2013 80

[Anonymous]

Is it just me or is commercial paper another language? I am on chapter 6 becker, does the rest of the chapter get ANY better? :/

[Anonymous]

Is it just me or is commercial paper another language? I am on chapter 6 becker, does the rest of the chapter get ANY better? :/

[Mansisheth]

Hello everyone!!

I am planning to sit for this section on August 23rd. Just got my NTS. I have purchased the Ninja audio and notes for this section and the audio is amazing so far. I listen to it on my way to work and the best use of the downtime.

JEFF – I just purchased the audio yesterday and notes couple days back. The notes say 13,000 for gifts and the audio says 14,000 – I am really confused as to which number to focus on. Are there any other changes if sitting for the exam in August? Becker website has no update regarding this. Also the section 179 numbers have changed?

Thanks for the help in advance!

[Author]

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