[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

[Just3Letters]

Nvm… figured it out

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

[ahugemistake]

what am I not understanding about a partner contributing an asset to a partnership as follows

Adj basis 30K, attached mortgage: 12K for 50% interest

partnership interest is 30 – 6 = 24K

why isn't it 30 + 12 – 6 = 36K?

FAR - 78*
AUD - 66, 79
REG - 73, 76
BEC - 79

[ahugemistake]

oh i get it now its actually

30K – 12K + 6K(other partner's share of liability) = 24K

FAR - 78*
AUD - 66, 79
REG - 73, 76
BEC - 79

[c1oth]

@ahugemistake yeah thats right

Partnerships:

If A, B, form a partnership, and A contributes equipment with a adjusted value of 200, FMV of 500, and Liability on the equipment of 100.

A's outside basis(the partner's basis in the partnership) would be

0- Intial basis + 200 (adjusted basis of equipment) – 100 (the liability) + 50(partner's % of the partnership's liability)= 150

[ahugemistake]

makes sense thank you @C1oth

FAR - 78*
AUD - 66, 79
REG - 73, 76
BEC - 79

[mckan514w]

@ahugemistake- the one thing that I read that really made partnership basis “click” for me is that a partner's basis is the risk he exposed to not necessarily the capital invested / received. Thus with the question above he is relived of 50% of the risk of the mortgage when he gives it to the partnership.

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

[csvirk]

Gary Berg, a farmer, exchanges a tractor with a basis of $40,000 and a value of $50,000 for a tractor with a value of $44,000 plus $6,000 cash. The basis of the tractor acquired by Gary is:

Correct A.
$40,000.

B.
$44,000.

C.
$46,000.

D.
$50,000.

I got the right answer butstill confused Why the answer is 40K. Any Simple Explanations? Thank you!

FAR: 71, 77!
AUD: 69, 80
BEC: 72
REG: 84

[mckan514w]

This is considered a like-kind exchange farming equipment- the New Basis is equal to the Basis of asset given up + any boot given (i.e. cash) +/- lesser of boot received or gain on transaction or loss – boot received

So Basis old Tractor 40,000
Additional Property given up 0
Gain on Transaction 6,000*** where boot got=6 and gain on transaction=10
Additional Property received (6,000)

40,000+6,000-6,000=40,000

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

[Anonymous]

Rental loss deducted upto rental income .but there is no limitation for deduction of rental expenses ,if property is exclusively use for the rental purpose. Is that right?

[Anonymous]

Anyone please help me.
what dividend income we include in gross income
and what dividend income is excluded especially what stock divided in include or which are not.
Thank you in advance.

[mckan514w]

Can ANYONE say ANYTHING to help make UCC negotiable paper stick in my head???? WTF every single question every single time wrong- I just can't keep it straight!!! HEEEEELLLLP!!!

@Ano- Real Estate losses are passive. If you are NOT materially participating in the property then the losses can only off-set passive gains (such as partnership income) if you do not have any passive income then the loss is carried over

If you DO actively participate in the property then you can deduct a maximum of 25,000 of the loss if your AGI is less than 100,000 if it is more than 100,000 then it is reduced by 50% of the amount over the AGI threshold- 25,000-((AGI-100,000)*.50)

You are correct no limitation to rental expenses….

Dividends are always included in AGI unless they are noted as Qualified…. then they are not: remember that dividends from corporations are limited to accumulated earnings and profits- any amount over that is considered a return on capital not a dividend and reduces your basis…

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

[Anonymous]

@ mckan514w
thank you, that helps!
there are two types of negotiable instrument
1)promissory note 2 party
2) draft like check 3 party
nor negotiable 5 conditions must be met
SUMBOD
S signature
U unconditional
M money fixed
BO payable to bearer or order
D payble on demand or specified time
For check no need to payable to bearer or order because the check is payable on demand.
so the last condition is automatically satisfied with the check

to negotiate bearer paper you need only delivery
for order paper, you need to delivery+ endorsement
when you negotiate order paper it becomes bearer paper and when you negotiate bearer paper it becomes order paper

[mckan514w]

@Ano- thanks I have all of that- I am getting really confused with “holders in due course” and real and personal defenses and the “shelter rule” they are all bleeding together for me… any words of wisdom 🙂

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

[Anonymous]

@mckan514w
2. To be a holder in due course (HIDC) you must meet 4 requirements a. You must be a holder of a negotiable instruments b. You must give present value, future value is no good c. You must have good faith d. You must be without notice of any problems or defenses • e.g. overdue, missing signature, party is told there’s a problem (payment refused)

3. HIDC takes free of personal defenses BUT loses to real defenses. a. Real Defense are defenses that beat an HIDC – I’M BIFF 1) Infancy 2) Material Alterations 3) Bankruptcy 4) adjudicated Insanity or Illegality or anything that would make a contract void 5) Fraud in the execution only (HIDC will beat fraud in the inducement) 6) Forgery (Duress is sometimes a real defense but only to the extent it makes an instrument void) b. All other defenses are personal defenses and an HIDC beats them

[mckan514w]

THANK YOU and! that helps…

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]

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