[jeff]

Welcome to the Q4 2017 CPA Exam Study Group for REG. 🙂

Introduce yourselves and let your fellow NINJAs know when you plan to take your REG exam.

The Five Steps (NINJA Framework): https://www.another71.com/pass-the-cpa-exam/

[Francis]

Entity Year End Guide:

Comments on below:

C Corp: Any, C Corp Chooses!
S Corp: 12/31 required, unless business purpose stated
Partnership:
A – principle parter (if no majority owner(s), principle parter owns more than 5% in profit/loss/capital
B – Year end of majority owner(s) – 1 or more partners own in aggregate 50% of more of partnership
C – Business purpose stated

Personal Holding Company – 12/31 required, unless business purpose stated
Trusts – 12/31
Estates – Any, Estates Elect!

I think this covers all entities and is factually accurate. Please let me know if this is helpful. Comments are greatly appreciated.

FAR - 08/25/13 - 65, 01/09/15 - fingers crossed
REG 10/22/13 - 69
AUD
BEC

[Atiq]

@Francis the summary is helpful. Taking my exam tomorrow lets see how it goes.

[Radez]

Francis, regarding medical deductions 7.5% is the floor applicable to people over the age of 65. For AMT purposes, that gets adjusted back to 10%, but I think that's the only time where there's a difference between the two?

[almostCPA]

@pharaoh I took the new version of REG as well. And I agree with @Lamis on new exam being harder than any software available. I passed 3 sections with Ninja (Notes and Audio were my go to products besides MCQ). For REG my trending score with Ninja MCQ was around 90% but I failed the actual exam with 72.
Sims that I got were very different from what the old version looked like. Even MCQs looked different, not a single straight forward question!

[Anonymous]

Hey Guys – I need some help understanding the deductibility of medical expenses. For the most part, the MC questions related to medical expenses can be straight forward, however, in the simulations using Becker sometimes you can get some curveballs thrown at you. Here is my high level understanding of how medical expenses can be deducted as an itemized deduction: If its a qualified expense, these are deductible to the extent that they exceed medical insurance reimbursement and 10% of AGI.

Here is my issue – I have a problem that involved medical insurance premiums paid with after tax dollars in the amount of $2,650 – The taxpayer had an AGI of $67,000 so my assumption was that this medical expense was not deductible because it did not exceeded the 10% AGI threshold, however, my assumption was of course wrong! Per the solution medical premium paid by a taxpayer are fully deductible as a medical expense!!! ugh!

Please feel free to share your how you guys learn all these different rules… Is this different because it was medical premiums?

Thanks!

[mashloum]

SoonToBeCPA, there is mixing here between two different issues, the first one is the medical expenses, and the second one is the medical health insurance, the first one is the deductible items under schedule A and subject to the @10% floor, while the second one is adjustment for the AGI and 100% deductible

[Wanna_B_TXCPA2014]

How many in the group are scheduled to test between 11/17/17 thru 11/20/17? I have scheduled my exam for 11/20/17.

[AScott89]

Wanna_B I'm a few days after you on the 25th of November. This will be my 2nd attempt at REG after getting a 72. So damn close. Stupid passive activity loss bullshit.

BEC-65
AUD-72(8 '14); 68(11 '14)
FAR-
REG-

[Anonymous]

Hi guys,

It's my understanding from my updated Gleim textbook that for 2017, the floor for deducting medical expenses on schedule B is now 10% of AGI for all ages and thus when computing AMT you no longer need to adjust from 7.5% for taxpayers over 65 to 10% for AMT purposes. I can post more detailed info from the book if anyone needs it.

[mashloum]

https://www.irs.gov/individuals/changes-to-itemized-deduction-for-medical-expenses
If you itemize your deductions on Form 1040, Schedule A, the threshold for unreimbursed medical and dental expenses you paid for yourself, your spouse, and your dependents must exceed 10 percent of your adjusted gross income before a deduction is permitted.

Most people who itemize their deductions can claim deductions for unreimbursed medical expenses, those which are not covered by health insurance, that exceed 10 percent of their adjusted gross income.

Temporary exemption for taxpayers age 65 and older

There is a temporary exemption for individuals age 65 and older until Dec. 31, 2016. If you are 65 years or older, you may continue to deduct total medical expenses that exceed 7.5 percent of your adjusted gross income through tax year 2016. If you are married and only one of you is age 65 or older, you may still deduct total medical expenses that exceed 7.5 percent of your adjusted gross income.

This exemption is temporary. Beginning Jan. 1, 2017, the 10 percent threshold will apply to all taxpayers, including those over 65.

[CoachEmUp]

3 days into the material and spent the full day on finishing agency and starting contracts for Business Law. Holy crap… I don't think I was ready to put on my lawyer hat to sit for a CPA exam. Worse, I've heard it's a pretty intregral part of the MCQ's. I can see where some basic questions about agency and contracts are good to know as a CPA… but statute of frauds and the nitty gritty on offer and acceptance?

Yikes. Felt good about the first two tests but I'm starting to get really concerned already for REG. This is going to be a real B to try and get through. God speed!

[Anonymous]

@mashloum

Thanks for that, good to know that it was a temporary exemption that expired.

Also probably worth pointing out that the tuition and fees deduction for AGI expired in 2016 as well. I believe the only way to get money back for tuition/school expense is with either the Lifetime Learning Credit (non-refundable) or the American Opportunity Credit (refundable).

[joonpark1212]

If anyone can help me with one question i have with individual AMT.

In calculating the AMT, there are various itemized deduction expenses that are disallowed thus requiring adjustments. But AMT also disallows standard deduction. So does this mean no matter what the individual selected between itemized deduction and standard deduction, both itemized deduction related items and standard deduction will be adjusted in calculating AMT?

[Anonymous]

@joonpark1212

I believe with AMT an individual adds back in the personal exemption amount and the standard deduction. If the individual taxpayer itemizes his/her deductions then some of the itemized deductions are added back, while others are not. For example, misc. itemized deductions, state, local, and foreign income taxes, and real and personal property taxes must be added back to taxable income for purposes of the AMT, while the medical expenses deduction (after the 10% floor) can still be excluded.

[Fee FIFO Fum]

Can anyone tell me if Commercial Paper is still being tested? I still see the deck in the flash cards. Can I ignore it or do I need to review it?

[Author]

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