[jeff]

REG Resources:

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

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

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

[UCMCPA]

The most common example, if you sell shares at a loss, then buy the shares back within a 30 day period after you sold, the previous loss is disallowed and it reduces the basis of the new shares.

This holds true if you buy and sell the same amount, say 50. But if you sold 50 shares at a loss, then bought back 25 shares, 1/2 of it is disallowed and 1/2 is allowed.

It's easier with an example.

FAR - 84
AUD - 94
REG - 86
BEC - 86

[UCMCPA]

The most common example, if you sell shares at a loss, then buy the shares back within a 30 day period after you sold, the previous loss is disallowed and it reduces the basis of the new shares.

This holds true if you buy and sell the same amount, say 50. But if you sold 50 shares at a loss, then bought back 25 shares, 1/2 of it is disallowed and 1/2 is allowed.

It's easier with an example.

FAR - 84
AUD - 94
REG - 86
BEC - 86

[Skrier]

I will try to find an example I can copy…..

AUD- 84
FAR- 75
REG- 78...I am DONE!!!
BEC- 79

[Skrier]

I will try to find an example I can copy…..

AUD- 84
FAR- 75
REG- 78...I am DONE!!!
BEC- 79

[terranz]

@UCMCPA – correct me if i'm wrong, but i think the disallowed loss in wash sale is added to new stock basis.

Also @UCMCPA – can you claim AOC credit in addition to the lifetime credit? my thought is YES, bc if AOC is per student, and lifetime is per student, you can claim both, the expenses just can't be used for both.

@skrier – my bad, got my sources confused. in wileys they say 504 general solicitation is permitted.

here is a snippet of Wileys on 504:

Rule 504 exempts an issuance of securities up to $1,000,000 sold in twelve-month period to any number of investors (this is also known as seed capital exemption)

(a) General offering and solicitations are permitted under Rule 504

(b) Issuer need not restrict purchasers’ right to resell securities

(c) No specific disclosure is required

(d) Must send notice of offering to SEC within fifteen days of first sale of securities

maybe @Insiyah can confirm or anyone else?

IS general solicitation ok in 504? dont think any of the answer choices w/ Yes are correct, but want to be sure

and never got confirmation on this:

for the 25% statute of limitations

gross income = gross receipts + capital gains correct?

not just the gross income they state in the problem (refer to page 14, but fact pattern is below)

Gross receipts $400,000

Less COGS and deductions 320,000

Net business income $80,000

Capital gains 36,000

Gross income $116,000

[terranz]

@UCMCPA – correct me if i'm wrong, but i think the disallowed loss in wash sale is added to new stock basis.

Also @UCMCPA – can you claim AOC credit in addition to the lifetime credit? my thought is YES, bc if AOC is per student, and lifetime is per student, you can claim both, the expenses just can't be used for both.

@skrier – my bad, got my sources confused. in wileys they say 504 general solicitation is permitted.

here is a snippet of Wileys on 504:

Rule 504 exempts an issuance of securities up to $1,000,000 sold in twelve-month period to any number of investors (this is also known as seed capital exemption)

(a) General offering and solicitations are permitted under Rule 504

(b) Issuer need not restrict purchasers’ right to resell securities

(c) No specific disclosure is required

(d) Must send notice of offering to SEC within fifteen days of first sale of securities

maybe @Insiyah can confirm or anyone else?

IS general solicitation ok in 504? dont think any of the answer choices w/ Yes are correct, but want to be sure

and never got confirmation on this:

for the 25% statute of limitations

gross income = gross receipts + capital gains correct?

not just the gross income they state in the problem (refer to page 14, but fact pattern is below)

Gross receipts $400,000

Less COGS and deductions 320,000

Net business income $80,000

Capital gains 36,000

Gross income $116,000

[UCMCPA]

@ terranz, yes to the education credits… but it can't be for the same student. It has to be for two different students.

FAR - 84
AUD - 94
REG - 86
BEC - 86

[UCMCPA]

@ terranz, yes to the education credits… but it can't be for the same student. It has to be for two different students.

FAR - 84
AUD - 94
REG - 86
BEC - 86

[terranz]

@UCMCPA sry i said it wrong in previous post – AOC is per student, lifetime is per credit

so, you can have both claimed on a tax return

but one students exp for AOC can't be used for lifetime correct?

[terranz]

@UCMCPA sry i said it wrong in previous post – AOC is per student, lifetime is per credit

so, you can have both claimed on a tax return

but one students exp for AOC can't be used for lifetime correct?

[Skrier]

@terranz…..

Rule 504 of Regulation D provides an exemption from the registration requirements of the federal securities laws for some companies when they offer and sell up to $1,000,000 of their securities in any 12-month period.

A company can use this exemption so long as it is not a blank check company and does not have to file reports under the Securities Exchange Act of 1934. Also, the exemption generally does not allow companies to solicit or advertise their securities to the public, and purchasers receive “restricted” securities, meaning that they may not sell the securities without registration or an applicable exemption.

AUD- 84
FAR- 75
REG- 78...I am DONE!!!
BEC- 79

[Skrier]

@terranz…..

Rule 504 of Regulation D provides an exemption from the registration requirements of the federal securities laws for some companies when they offer and sell up to $1,000,000 of their securities in any 12-month period.

A company can use this exemption so long as it is not a blank check company and does not have to file reports under the Securities Exchange Act of 1934. Also, the exemption generally does not allow companies to solicit or advertise their securities to the public, and purchasers receive “restricted” securities, meaning that they may not sell the securities without registration or an applicable exemption.

AUD- 84
FAR- 75
REG- 78...I am DONE!!!
BEC- 79

[Journhi]

@skrier

Here is a good tricky example for wash sale. I hope it helps! I hate REG…my test is tomorrow and I have study so much but I feel like I know nothing 🙁

Sands purchased 100 shares of Eastern Corp. stock for $18,000 on April 1 of the prior year. On February 1 of the current year, Sands sold 50 shares of Eastern for $7,000. Fifteen days later, Sands purchased 25 shares of Eastern for $3,750. What is the amount of Sands’ recognized gain or loss?

The requirement is to determine Sands’ recognized gain or loss from the sale of stock. Since Sands purchased 100 shares of Eastern Corp. for $18,000 and sold 50 shares for $7,000, Sands’ realized loss equals $7,000 selling price – $9,000 basis = $2,000. However, no loss can be recognized on the sale of stock if substantially identical stock is purchased within 30 days before or after the loss sale. If a taxpayer acquires less than the number of shares sold, the amount of loss that cannot be recognized is determined by the ratio of the number of shares repurchased to the number of shares sold. Since Sands sold 50 shares of Eastern and 15 days later purchased 25 Eastern shares, 25/50 or 1/2 of Sands’ $2,000 realized loss cannot be recognized, while the remaining $1,000 of Sands’ loss will be recognized.

So a loss of $1,000 is allowed; while the other $1,000 is added to the basis of the new 25 shares (total basis = $4,750).

FAR: 62;79
AUD: 76
REG:67; 77
BEC: 68;66; 12/05/13

[Journhi]

@skrier

Here is a good tricky example for wash sale. I hope it helps! I hate REG…my test is tomorrow and I have study so much but I feel like I know nothing 🙁

Sands purchased 100 shares of Eastern Corp. stock for $18,000 on April 1 of the prior year. On February 1 of the current year, Sands sold 50 shares of Eastern for $7,000. Fifteen days later, Sands purchased 25 shares of Eastern for $3,750. What is the amount of Sands’ recognized gain or loss?

The requirement is to determine Sands’ recognized gain or loss from the sale of stock. Since Sands purchased 100 shares of Eastern Corp. for $18,000 and sold 50 shares for $7,000, Sands’ realized loss equals $7,000 selling price – $9,000 basis = $2,000. However, no loss can be recognized on the sale of stock if substantially identical stock is purchased within 30 days before or after the loss sale. If a taxpayer acquires less than the number of shares sold, the amount of loss that cannot be recognized is determined by the ratio of the number of shares repurchased to the number of shares sold. Since Sands sold 50 shares of Eastern and 15 days later purchased 25 Eastern shares, 25/50 or 1/2 of Sands’ $2,000 realized loss cannot be recognized, while the remaining $1,000 of Sands’ loss will be recognized.

So a loss of $1,000 is allowed; while the other $1,000 is added to the basis of the new 25 shares (total basis = $4,750).

FAR: 62;79
AUD: 76
REG:67; 77
BEC: 68;66; 12/05/13

[UCMCPA]

No. If you have the same student, they can only use if for the AOC or LL, however, I would always pick the AOC because it was refundable (not sure if it is in 2013)

Also for AMT purposes… Becker says in 2012 the AMT exemption is 33,750 for single, but yet the IRS says it was 50,600. Why such a huge difference?

https://www.irs.gov/uac/Newsroom/Annual-Inflation-Adjustments-for-2013

FAR - 84
AUD - 94
REG - 86
BEC - 86

[Author]

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