[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

[Gabe]

C

19- distribution

-8- AAA not taxable

-10k- taxable, does NOT reduce basis

-1k- NOT taxable, reduces basis, return of capital

AUD: 84
BEC: 76
FAR: 81
REG: 4/3/15

OK Candidate

[Troblin]

@Gabe Thanks.

Is the breakdown that you provided the same between S-Corps and Corporations?

Most of the other Ninja MCQ deal with dividend declarations with respect to Accumulated Earnings (Corporations).

FAR: 85(11/22/2014) - Becker(full)/Ninja MCQ (5 day cram)
AUD: 79 (2/1/2015) -Becker/Ninja MCQ/Ninja Notes
REG: 84(4/19/2015) -Becker/Ninja MCQ/Ninja Notes
BEC: 83 (7/13/2015) -Becker/Ninja MCQ/Ninja Notes

Date I Got My Life Back!: 8/4/2015 🙂

[Gabe]

@troblin I'm confused by your question a bit. My breakdown was related to it being an S corp that was a C corp. If it was not an S corp it would NOT have AAA.

Basically it was a C corp then elected to be an S corp

The accum E&P is a carryover from the C corp

The AAA is basically like RE for an S corp (shows all the activity since inception)

Does that help?

AUD: 84
BEC: 76
FAR: 81
REG: 4/3/15

OK Candidate

[terryharm]

@gabe, working on it, I sent my MBA transcripts and they have the information they requested from the other University. Fingers crossed, they said the review will be done on the 15th. Fingers crossed until then, this is the easy part nothing like the stress of the exam and waiting for grades.. and worst case I take a 5 week class on tax or auditing and be done.. Hard part is over…

BEC: 81
FAR: 75
AUD: 81
REG: 85

PA license Pending..

[Gabe]

@terry good! fingers crossed for ya!

AUD: 84
BEC: 76
FAR: 81
REG: 4/3/15

OK Candidate

[Troblin]

@ Gabe. Thanks, that clarified things.

FAR: 85(11/22/2014) - Becker(full)/Ninja MCQ (5 day cram)
AUD: 79 (2/1/2015) -Becker/Ninja MCQ/Ninja Notes
REG: 84(4/19/2015) -Becker/Ninja MCQ/Ninja Notes
BEC: 83 (7/13/2015) -Becker/Ninja MCQ/Ninja Notes

Date I Got My Life Back!: 8/4/2015 🙂

[jstay]

on 1/27 i got 51% in commercial paper, on 4/2 i improved to 62%, i guess its better then going down but still i hate seeing a score in the 60s…

[Anonymous]

@gabe good luck tomorrow! Plz stay active in this thread we need you!

[Anonymous]

Anybody else struggling with partnership taxation?? I'm having a hard time with the mcq

[Troblin]

Regarding Trusts. Can someone provide a distinction between the following three items:

1)Gross Income

2)Distributed Net Income

3)Income Distribution Deduction

FAR: 85(11/22/2014) - Becker(full)/Ninja MCQ (5 day cram)
AUD: 79 (2/1/2015) -Becker/Ninja MCQ/Ninja Notes
REG: 84(4/19/2015) -Becker/Ninja MCQ/Ninja Notes
BEC: 83 (7/13/2015) -Becker/Ninja MCQ/Ninja Notes

Date I Got My Life Back!: 8/4/2015 🙂

[mmcleani202]

Can someone explain to me why the shareholder is taking the FMV of the property in this distribution? I thought that when there is 80% control (sole shareholder) and no boot received that it is a non taxable distribution which would mean the shareholder takes the basis of the property? Maybe I'm getting something confused but I think it will really help my score out if I can nail this concept.

Fox, the sole shareholder in Fall, a C corporation, has a tax basis of $60,000. Fall has $40,000 of accumulated positive earnings and profits at the beginning of the year and $10,000 of current positive earnings and profits for the current year. At year-end, Fall distributed land with an adjusted basis of $30,000 and a fair market value (FMV) of $38,000 to Fox. The land has an outstanding mortgage of $3,000 that Fox must assume. What is Fox's tax basis in the land? Answer 38000

Aud 67
Reg 30, 67
Far 50
Bec

[Anonymous]

What's the difference between a partners basis in a partnership and his/her capital account? What even is a capital account?

[Future Ninja]

did you know that:

IRC excludes inheritance and proceeds from lawsuits for physical injuries from income.

AUD - 79 (expired) retaking July 28,2016
FAR - 76 expiring July 31, 2016
BEC - 85
REG - 74,74,74,74,59,70,

[Future Ninja]

@Gabe Best of luck tomorrow.

AUD - 79 (expired) retaking July 28,2016
FAR - 76 expiring July 31, 2016
BEC - 85
REG - 74,74,74,74,59,70,

[Anonymous]

@Troblin

1)Gross Income- same as for individuals. add up income items

2)Distributable Net Income- the maximum amount of income that can be distributed. this means adding back the personal exemption and tax exempt income and subtracting stuff going to corpus

3)Distribution Deduction- the taxable income. subtract out tax exempt income

@mmcleani202 your thinking of sec 351 which has to do with contributions, not distributions.

Property dividends is always FMV of the property distributed

Fox's basis in the land is FMV which equals 38,000. This is comprised of 35,000 income and 3,000 debt

Fox has a dividend of 38,000- 3,000= 35,000

The C corp has a gain of 8,000 (38,000-30,000)

A's EP goes down by 27 (8,000 gain – (38,000-3,000))

@cpa8488 a partners tax basis is the cost of their partnership interest and the capital account is the value of the interest the partner has in the partnership

[Author]

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