[jeff]

Welcome to the Q1 2017 CPA Exam Study Group for REG. 🙂

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

[aatoural]

How is everybody doing?!!

BEC - PASSED
AUD - 8/29/16
FAR - TBS
REG - TBS

[wakefern58]

For estate taxes, the estate income distributed to the beneficiary is taxable only to the extent of distributed net income. Any excess distribution above the DNI is considered principal corpus and is NOT taxable to the beneficiary since the estate tax is imposed on that principal corpus.

Do i have this correct?

[NwOWolfPak]

Super nervous for my retake on Tuesday. Hoping not to see any Corporate AMT questions. Good luck studying everyone !

[jack yassa]

Hello Guys,
I'm confused between sep and non sep stated items?
What's is it and does it differs from “S” corp to Partnership ?

Thanks a lot.

[jack yassa]

Question CPA-01952
Baker, an individual, owned 100% of Alpha, an S corporation. At the
beginning of the year, Baker's basis in Alpha Corp. was $25,000. Alpha
realized ordinary income during the year in the amount of $1,000 and a longterm
capital loss in the amount of $3,000 for this year. Alpha distributed
$30,000 in cash to Baker during the year. What amount of the $30,000 cash
distribution is taxable to Baker?
a. $0
b. $5,000
c. $4,000
d. $30,000
Explanation
Choice “c” is correct.

*As i understand, distribution is taxable in excess of basis which is +25K+1K-3K
Now why they didn't consider the loss ?

Thanks

[HoosierCPA]

@jack capital loss is always the last thing to be distributed so you would calculate this problem as $25k+1k=26k. You apply the distribution. If there was any basis still remaining (which there isn't in this problem) then you would apply it. The amount of capital loss disallowed is carried forward to future years

FAR - 78
REG - 72,74,71...please just go away REG nobody likes you!
BEC - 82
AUD - Aug 16

[HoosierCPA]

@aatoural good to hear from you!! How's FAR studying going?!

FAR - 78
REG - 72,74,71...please just go away REG nobody likes you!
BEC - 82
AUD - Aug 16

[jack yassa]

@dtatham10,

Thanks a lot! one more question please?

I’m confused between sep and non sep stated items?
What’s is it and does it differs from “S” corp to Partnership ?

Thanks a lot, and i do appreciate all you efforts 🙂

[jack yassa]

@dtatham10
That's how i understand basis in “S” Corp

Beg Basis
+Additional basis
+Income %
+Taxable interest
+Tax except interest
-Loss ” Ordinary”
-Loss “Capital” LT & ST
-Distribution
===================================
At risk amount

Is that correct?

[HoosierCPA]

@jack off the top of my head (not currently studying) I believe there isn't much difference between partnership and s Corp. Partnership will have guaranteed payments anddd I think 2 other items! I have both k1's sitting on my desk as work because this was something I was trying to study last week!! I can follow up on this tomorrow!

FAR - 78
REG - 72,74,71...please just go away REG nobody likes you!
BEC - 82
AUD - Aug 16

[Anonymous]

I would like to take REG before the changes, but I'm going to grad school and working about 20hrs a week. Is it possible to prepare myself by march or should I just wait?

[aatoural]

@dtat – its been hard! I think I just started to get the hang of it this weekend. I am not very convinced about Becker's explanations to answers thu.

BEC - PASSED
AUD - 8/29/16
FAR - TBS
REG - TBS

[HoosierCPA]

@aa I wish I could help! It's been so long since I took it!

If I had to put together a top 3 list of stressful things about the cpa exam no question on there would be the first time going through material. You feel so overwhelmed and it almost feels like you're learning nothing. I know exactly what you're going through–especially with the beast that they call FAR! Just keep going at it one topic at a time, if you don't immediately understand something I would suggest noting it, move along and then come back to it later.

FAR - 78
REG - 72,74,71...please just go away REG nobody likes you!
BEC - 82
AUD - Aug 16

[HoosierCPA]

@jack I noticed I skipped over one of your questions. Yes your calc for S-Corp basis appears correct.

For separately vs non separately stated items for partnership vs shareholder. Based off the K-1:

Included in the partnership and not included on s corp:
-Guaranteed payments, self employment earnings, tax exempt income and non deductible expenses, distributions.

Everything else is the same on both forms.

FAR - 78
REG - 72,74,71...please just go away REG nobody likes you!
BEC - 82
AUD - Aug 16

[aatoural]

@dtat – thanks for teh advice. I actually did that with the first chapter which caught me off guard. So I did chapter 2 and then went back to 1 and it was easier.

BEC - PASSED
AUD - 8/29/16
FAR - TBS
REG - TBS

[Author]

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