[jeff]

Welcome to the Q2 2016 CPA Exam Study Group for REG.

Some BLITZ videos to help your exams: https://www.another71.com/ninja-blitz

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

[monikernc]

i know we have been around the bend on IRA contributions and phaseouts but ninja #1088 makes no sense. why does the solution multiply $4000×2 for the maximum contribution when only 1 IRA deduction for $4000 has been made? And why is the maximum only $4000?

Rita Spano is an active participant in a company retirement plan. Her husband, John, age 45, works for a company that does not have a retirement plan. The Spanos' joint adjusted gross income for 2015 is $187,000. John contributes $4,000 to an IRA for himself. How much of this $4,000 contribution for John can the Spanos deduct on their 2015 joint return?

A. $4,000
Correct B. $2,900
C. $2,000
D. $0

Calculation for reduced IRA contribution:

1) Modified AGI $ 187,000
– 183,000
2) Difference between AGI and phaseout $ 4,000
Full contribution limit / 11,000
3) Reduction factor 0.364

4) Maximum contribution ($4,000 x 2) $ 8,000
Reduction factor x 0.364
Reduction amount $ 2,912 ($2,900 rounded)

FAR 7/25/15 76!
AUD 10/30/15 93
BEC 2/27/16 82
REG 5/23/16 88!
Ninja Book and MCQ and the forum - all the way!!!
and a little thing i like to call, time and effort!
if you want things to change, you have to do something different

[Anonymous]

@monikernc
Ira phase out amount starts from 183000
Joint AGI = 187000
Phase out for joint filler (187000-183000)4000/20000*5500=1100
contribution made is 4000-1100=2900

[monikernc]

Ano – thank you. what is the 20,000 in the 4,000/20,000 in your solution?

FAR 7/25/15 76!
AUD 10/30/15 93
BEC 2/27/16 82
REG 5/23/16 88!
Ninja Book and MCQ and the forum - all the way!!!
and a little thing i like to call, time and effort!
if you want things to change, you have to do something different

[Anonymous]

@monikernc
computation of phase out is AGI – 61000/10000*5500

for married filing jointly change the phase out starting amount which in your question is 183000 and multiply 10000 with 2 20000.

[monikernc]

why 2? sorry, i am tired and this is not making sense.

FAR 7/25/15 76!
AUD 10/30/15 93
BEC 2/27/16 82
REG 5/23/16 88!
Ninja Book and MCQ and the forum - all the way!!!
and a little thing i like to call, time and effort!
if you want things to change, you have to do something different

[Anonymous]

for single taxpayer we divide by 10000
for married filing jointly we divide by 20000

[Anonymous]

https://books.google.com/books?id=7IM1x38McqIC&pg=PA444&lpg=PA444&dq=wiley+book+ira+married+filing+jointly+$20000

click on this link and look at F1(c)

[monikernc]

so, even though only one is contributing he gets to double the phaseout range to calculate his allowed deduction? wow, i need to get married again…

thank you Ano.

3 days, 12 hr/day on this stuff since friday and i am not feeling any more ready than i did friday morning

i sit next monday and hope to have a more productive week – i am living in very strange times right now. studying is a challenge.

FAR 7/25/15 76!
AUD 10/30/15 93
BEC 2/27/16 82
REG 5/23/16 88!
Ninja Book and MCQ and the forum - all the way!!!
and a little thing i like to call, time and effort!
if you want things to change, you have to do something different

[Anonymous]

@monikernc
I think you are more than ready for the exam , I am taking on 27th of this month and I just started corporation to review and still left the gift and estate to revise and then business law.

[monikernc]

it took forever to get through biz law and even though i kept reviewing tax while going through it, it took so long that i have forgotten a lot of the little tax things. i have read all your posts this weekend – you know a lot more than i do at this point.
gift is not bad. estate can be a little tricky but not don't worry. biz law, look in the UCC while you study to get a feel for it for the sims. the UCC is a monster and the language is difficult. i want only one research question on my exam.

i can't wait to take this exam but i really want to pass on first try so i keep plugging away

thank you so much for your help

FAR 7/25/15 76!
AUD 10/30/15 93
BEC 2/27/16 82
REG 5/23/16 88!
Ninja Book and MCQ and the forum - all the way!!!
and a little thing i like to call, time and effort!
if you want things to change, you have to do something different

[monikernc]

is anyone else experiencing slow response times in the ninja REG mcq's? mine has been awful this weekend and today has been the worst

FAR 7/25/15 76!
AUD 10/30/15 93
BEC 2/27/16 82
REG 5/23/16 88!
Ninja Book and MCQ and the forum - all the way!!!
and a little thing i like to call, time and effort!
if you want things to change, you have to do something different

[TimWantsTheLion]

So, I'm confused now regarding Partnership Contributions and recognition of income after dealing with this problem in the NINJA MCQ bank:

Quigley, Roberk, and Storm form a corporation. Quigley exchanges $25,000 of legal fees for 30 shares of stock. Roberk exchanges land with a basis of $10,000 and a fair market value of $100,000 for 60 shares of stock. Storm exchanges $10,000 cash for 10 shares of stock. What amount of income should each shareholder recognize?

A. Quigley $0, Roberk $0, and Storm $0

B. Quigley $25,000, Roberk $90,000, and Storm $0

C. Quigley $25,000, Roberk $90,000, and Storm $10,000

D. Quigley $0, Roberk $90,000, and Storm $0

The correct answer is B. While I understand that nobody in the partnership combined owns 80% cash/property to have control (and thus, they must recognize income on their tax returns), I am baffled at the reason why Storm's cash contributed doesn't give him recongizable income. Does it not matter how much one owns in the partnership for cash contributions to not be recognizable income?

REG - 62, 71, 72 (Rematch sometime in October)
AUD - 65, 69, 70, 73, 72, 81 (Exp. 4/30/2017)
FAR - 61
BEC - 57, 73, 75 (Expired)

[Anonymous]

@tim
when there are not a 351 controlled transaction shareholders may recognize gain if the FMV of the property transferred is greater than its adjusted basis
Storm just gave cash and receive stock there is nothing to recognize gain.

[Tncincy]

Oh boy, I might be panicking, but those that have taken reg are talking about unfamiliar topics, and sims on the test……don't know if I should go back to the book to make sure I'm covering everything…..count down 25 days.

It begins with a 75
Been here too long as a cheerleader....ready to pass

[mtaylo24]

They will never put an unfamiliar topic on an exam. They will hit you with questions from “unimportant” chapters, but I wouldn't go as far to call it “unfamiliar”.

AUD - 1st - 60 (12/12), 61 (2/13), 61 (8/13), 78! (11/15)
REG - 55 (2/16) 69 (5/16) Retake(8/16)
BEC - 71(5/16) Retake (9/16)
FAR - (8/16)

[Author]

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