[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

[jstay]

Gabe, do you think 6,000 questions will do the trick?

[Anonymous]

Jstay: I'm a firm believer in quality over quantity. You can knock out 6,000 MCQ quickly and without really understanding things. Or you can only do 1,000 MCQ but take just as much time to fully understand the question.

Right now I'm trending at 84% (just got it up there today). I'm 51% through Adaptive Learning. When I do MCQ, I do them in 30 question blocks. Typically I find that when I just rush through them, I tend to miss a lot more than the times when I go slowly and really read the question and answers. When I start to just rush through, that tells me it's time to take a break and to come back a bit later after clearing my head.

[jstay]

@Angelwatch, yeah i agree. Within the month leading up to my exam i will have 23 days of full on study days where i do nothing but study. hopefully i can ATLEAST get through 200 questions a day so that puts me at 4,600 right there plus if i can do a little more then hopefully i can. 23 days of full studying times 7 hours is 161. plus what ive done up until this point and what i will continue to do until 4/15. and then review hits and i study all day everyday

[Anonymous]

completely confused by trusts and estates

also, my scores are really not that bad on both gleim and ninja, and yet I still don't feel like I know or remember anything

[Anonymous]

Yeah Trusts and Estates are not fun topics for me either. It's a confusing subject. I understand the basics but I'm really hoping they're not heavily tested come exam day.

[Anonymous]

1.Ethics/Prof/Legal Responsibilities

2.Business Law

3.Federal Tax Process, Procedures, Accounting, and planning

4.Fed Taxation of Property Transactions

5.Federal Taxation of Individuals

6.Federal Taxation of Entities

Above are the CSO how do these line up with the Becker chapters?

1. R5

2. R6-8

3.

4.

5.R1-2

6.

[Anonymous]

Becker chapters:

R1 – Individual Tax – Income

R2 – Individual Tax – Adj, deductions and credits

R3 – C and S Corp taxation and exempt organizations

R4 – Property, partnership and estate and gift tax

R5 – Ethics and SEC regulation

R6-8 – Business law

[Gabe]

In re: to trusts and Estates, I think if you know the basics you'll be fine.

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

OK Candidate

[Anonymous]

@gabe: get off this forum and enjoy your time off!! just sit back and relax I know you got a 99 🙂

[willpassby2014]

Natalie inherited land from her Uncle Josh, who died January 3, 2014. The basis to Josh was $1,000,000 and the value on January 3, 2014, was $7,200,000. On July 3, 2014, the value was $7,600,000. When the land was distributed to Natalie on June 3, 2014, the value was $7,400,000. This land was Josh's entire estate. Natalie's basis for the estate is:

A. $1,000,000.

B. $7,200,000

C.$7,400,000.

D.$7,600,000

Can some one tell me when (C) is not the correct answer?

BEC Passed
FAR Passed
AUD Passed
REG Passed

[Anonymous]

how am i supposed to remember this, i don't even follow

Mary gives Joanne a gift of land worth $80,000. The land’s original cost to Mary was $30,000. As a result of the transfer, Mary paid a gift tax of $12,000. What is Joanne’s basis in the land? Assume an annual gift exclusion of $14,000.

a $39,091

Correct! A donee’s basis in an appreciated gift is equal to the donor’s basis plus gift tax paid with respect to the gift’s appreciation. The amount of gift tax added is the amount of tax paid, $12,000, multiplied by the ratio of the net appreciation in the value of the gift, $50,000, to the amount of the gift, which is calculated after eliminating the annual gift exclusion, $80,000 – $14,000 or $66,000. As a result, the amount of gift tax that will be added to the donor’s basis of $30,000 will be $12,000 x ($50,000/$66,000) or $9,091 and the basis will be $39,091.

b $30,000

c $42,000

d $37,500

[Future Ninja]

Taken from NinjaMCQ. It's my favorite question, be sure to know this (based on my experience)

Jim and Kay Ross contributed to the support of their two children, Dale and Kim, and Jim’s widowed parent, Grant. Dale, a 19-year-old full-time college student, earned $4,500 as a baby-sitter. Kim, a 23‑year-old bank teller, earned $12,000. Grant received $5,000 in dividend income and $4,000 in nontaxa­ble Social Security benefits. Grant, Dale, and Kim are U.S. citizens and were over one-half supported by Jim and Kay. How many exemptions can Jim and Kay claim on their joint income tax return?

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

[Anonymous]

Willpassby2014: The correct answer is B. I remember that question and I don't like their explanation. It's very complicated and has to do with thresholds above $5 million and so on. I doubt we'll get anything that complex on exam day so I like to think of the reasoning in more broad terms. For inherited property, you either use the FMV at date of death or the FMV 6 months later if the alternative valuation method is chosen. So in this question the FMV at date of death is $7.2 million. $7.6 million could have been the right answer but it said nothing about using the alternative valuation method. That's my reasoning on the question. Like I said, the official answer is more complicated than that but the answer is still B.

Anjana: That's one of those questions I just shrug and move on. Remember on exam day you are not going to remember 100% of the material and trying to remember these really obscure little details that appear in a single question isn't worth it. If you don't get the concept for a one-off type of question like that, move on. The odds that you'll get a similar question like that on exam day are nearly zero. Now if it had been a basic Like-Kind exchange question, I would be telling you to sit down and learn the concepts. But for something like this, it's just best to focus your energy on material that is more likely to show up on exam day. It's an unsatisfying answer but sometimes it's for the best. Too easy to drive yourself crazy otherwise.

Future Ninja: 3 exemptions

Jim, Kay and Dale . Kim does not qualify since she does not meet the child test and earns too much money. Grant is a tricky one since he has income but the social security does not count. But in the end he makes too much money (I think it's in the 3,000 range of taxable income).

[Gabe]

@angel I believe it's above $3,900 (for the income portion) but I don't have my book in front of me.

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

OK Candidate

[Anonymous]

You're close. It's 3,950. Which in 2014 is the amount of a personal exemption. If they have taxable income over the amount of the personal exemption, they fail the support/income test and are not a qualified relative.

[Author]

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