[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

[mckan514w]

So in the instance of the above question a machine that cost 161,000 is well under the 500,000 amount meaning she can depreciate the entire machine in year 1

and they ask me why I drink...

FAR- 61-next time I'll ask for lube instead of a calculator
REG-75- Never been so happy to see such a low grade
BEC- 8/11
AUD- 9/2

[mckan514w]

and they ask me why I drink...

FAR- 61-next time I'll ask for lube instead of a calculator
REG-75- Never been so happy to see such a low grade
BEC- 8/11
AUD- 9/2

[Just3Letters]

Claudia is here too! It's like a reunion lol

I guess I was the straggler! I feel good about my exam other than one of the sims and a few MC questions. Everybody says when you feel good about an exam you probably failed so I guess I'll be back in FAR with you all in the fall 🙁

SO NERVOUS for release day next week!

Mckan, thanks for the help on the stock options! That makes sense now! I enjoyed tax in school but only took one tax class so this should be interesting!

FAR- 81
REG- 81
BEC- Aug 22, 2016
AUD- TBD

[monikernc]

mckan, the question says she expensed the full cost of the machine in 2014 under sect 179. that is all you had to know to answer that question because depreciable base is now reduced to 0. this question doesn't get into the other facets of sect 179 but remember it is limited not only to the 500,000/2,000,000 2014 amounts and/or the 25,000/500,000 2015 amounts but also it is only allowed up to taxable income.

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

[Just3Letters]

Does anybody have a simple “go-to” in determining if an item is an adjustment or an itemized deduction?

Rather than memorizing medical expenses, interesting on education loans, and a billion other things…

FAR- 81
REG- 81
BEC- Aug 22, 2016
AUD- TBD

[Claudia408]

Roger has a good mnemonic

Gross Income
+/- adjustments – I EMBRACED EHF
AGI
Deductions – Itemized A – COMMITT or Std Deductions

Personal Exemptions
Taxable Income
* Tax Rate

Tax Liability
(Credits)
(W/H Tax)
(prepaid tax)
AMT – SIMPLE PIE

Tax Due

Mnemonic
I _EMBRACED EHF

Interest on Student loans (2,500 limit)
Employment Tax 100% – Med Premium 50%
Rent/Royalties/Flow through
Alimony – CANNOT
Contribution to Pension
Early W/drawl
Duty – Jury

Education
Health Savings A.C
Farmers

COMMITT

Charitable contributions
Other Mis
Misc -BIT
Medical 10% or 7.5% if 65 plus
Interest on Mortgage/Equity
Theft/Casualty
Taxes Paid

BEC - 75 (3x)
AUD - 78 (3x)
REG - 67, 66, Aug 1
FAR - 54, Sept 8

[Just3Letters]

Thanks Claudia,

those are great!

on the deductions mnemonic, what is the BIT next to miscellaneous?

FAR- 81
REG- 81
BEC- Aug 22, 2016
AUD- TBD

[Just3Letters]

Also, sorry for all the questions that probably seem super simple to you guys!

One more while I'm at it: should I be worried about knowing the specific phase-out limits for AGI for deductions (259,400 for single as an example) or just that there is a phase-out? Is the exam going to tell me the phase-out for the problem?

FAR- 81
REG- 81
BEC- Aug 22, 2016
AUD- TBD

[mtaylo24]

@mckan514w Here is the solution to the question I asked on pg 17

Answer (B) is correct.
If bonds are issued by a corporation and are subsequently repurchased at a price less than the issue price minus any amount of premium already recognized as income, the difference is included in income for the taxable year. Prior to 1987, a corporation could elect to exclude the income and reduce the basis of property, but this election is available in post-1986 years only in cases of bankruptcy or insolvency. The amount of income taxable to Homer is

Step 1: 2,600,000 (issue price) – 2,000,000 (face amount) = 600,000 (premium)
Step 2: 2,600,000 (issue price) – 264,000 (premium incl in income, which is [(60,000/50 yrs)*22 yrs] = 2,336,000
Step 3: 2,33600 – 2,320,000 (repurchase price) = 16,000 (amt included in 2015 income)

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)

[rmm77]

Filler-Up is an accrual-basis calendar-year C corporation. Filler-Up uses an allowance method for accounting for bad debts. The allowance for bad debts was $20,000 at the beginning of the year and $30,000 at the end of the year. During the year, Filler-Up wrote off $5,000 of uncollectible receivables and accrued an additional $15,000 of expenses for accounts estimated to be uncollectible. What is the Schedule M-1 adjustment on Filler-Up's federal income tax return?

$10,000 decrease in taxable income.
$10,000 increase in taxable income.(right)
$5,000 decrease in taxable income.
$5,000 increase in taxable income.

How?

FAR-74,92
BEC-85
AUD-8/8
REG-83

[Claudia408]

Just3 – BIT:
business expense of an employee
investment expenses
tax prep and attorney fees

BEC - 75 (3x)
AUD - 78 (3x)
REG - 67, 66, Aug 1
FAR - 54, Sept 8

[Bear-Bear]

I see all of you on here posting about Tax…I'm dreading that section. I'm finishing up Business Law, which has been it's own brand of hell.

[Anonymous]

@rmm77

M1 is the reconciliation of book income to taxable income before dividend received deduction and net operating loss deduction .
So net effect of allowance for doubtful debt in book is ending balance minus opening balance (30000-20000)
book income is reduced by $ 10000 so in order to reach to the taxable income we need to add the $10,000 to book income.

[Claudia408]

@Bear-Bear – you passed FAR, that is deepest darkest hottest hell. Tax is a sunday walk in the park.

BEC - 75 (3x)
AUD - 78 (3x)
REG - 67, 66, Aug 1
FAR - 54, Sept 8

[mckan514w]

Yay I got it right! thanks @mtaylo24

and they ask me why I drink...

FAR- 61-next time I'll ask for lube instead of a calculator
REG-75- Never been so happy to see such a low grade
BEC- 8/11
AUD- 9/2

[Author]

Replies