[jeff]

Welcome to the Q2 2015 CPA Exam Study Group for REG.

“Death and Taxes” – Individual Tax for the CPA Exam

Posted by Another71 on Monday, November 24, 2014

Free NINJA: https://www.another71.com/cpa-exam-study-plan/

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

[Holly]

@Kate for your boot question could you give me an exact question you're referring to so I can make sure I understand? I have Becker too so I'll see what you're looking at.

The simulation question I'll tell you my reasoning and someone else can chime in if they understand better. I was under the thought process that the four of them are the “control group” who own more than 80% so therefore it is not taxable. Not taxable always = NBV regardless of any other information.

BEC - 79
REG - 85
AUD - 5/27/16

[Anonymous]

A financing statement relates to perfection of a security interest and not relevant to attachment. Then what is an authentication record? I think I'm assuming these two are the same thing…

[Anonymous]

Just want to clarify correct me if I'm wrong. Their are 3 types of security interests.

1. PMSI

2. Attachment security interest

3. Perfection of the security interest

Each has its own requirements (I have them written down).

[Gabe]

@Kate I don't have Becker anymore, but I agree with HR, regardless of other info, as long as they don't own >80%, basis=NBV because it is not a taxable event.

CPA, CFE
CISA- Experience will be completed by August 2016

[Gabe]

@cpa

PMSI is a type of security interest

where as attachment and perfection of an interest are things that happen to a security interest. Does that make sense?

CPA, CFE
CISA- Experience will be completed by August 2016

[Gabe]

@cpa an authenticated record is another way for a security to ATTACH. In the old days, security interests were all in writing, now they can be electronic…that's where an authenticated record comes into play- it's the electronic way to attach a security interest

CPA, CFE
CISA- Experience will be completed by August 2016

[Anonymous]

Kinda makes sense… So you can have a PMSI attach or a PMSI perfected?

[Anonymous]

[Gabe]

a PMSI is automatically superior (purchase money security interest)…

order of importance:

Consumer transaction (automatic)

PMSI

Perfected

Attached/unperfected

Does that help? Or have I confused you more? 😉

CPA, CFE
CISA- Experience will be completed by August 2016

[NJPRU]

@Gabe, just remember those PMSI rules about inventory and equipment as well. wink wink.. at least I think it was PMSI. I dont have have the book in front of me.

AUD: DONE
FAR: DONE
BEC: DONE
REG: DONE

IM GOING TO BE A CPA!!!!!

[Peterman25]

Yes..PMSI allows you to attach to inventory and equipment after the fact. Makes sense. If I give you a line of credit I definitely want to take an interest in what you buy with it it you default.

BEC 7/14 - PASS
FAR 10/14 - PASS
AUD 1/15 - PASS
REG 4/15 - PASS

AZ license - Official 8/20/2015

[Gabe]

^^ Peterman is correct and I 100% agree haha,

CPA, CFE
CISA- Experience will be completed by August 2016

[Anonymous]

@peter I think it's equipment only not inventory that you can attach after the fact. Right?

[Anonymous]

@gabe I understand PMSI is the best and I understand the order of importance. What confuses me is when I'm reading the question and it refers to the security interest I don't understand if their asking about attachment or perfected. Maybe I just need to read the questions more carefully now that you have clarified a few things for me.

[Gabe]

@cpa good point- I remember reading a MCQ about only one being able to attach…but on R7-36 it states inventory AND equipment (called non inventory) can be attached. Anyone have any insight?

CPA, CFE
CISA- Experience will be completed by August 2016

[Author]

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