[jeff]

Welcome to the REG CPA Exam study group for July & August 2018 exams. 🙂

Please introduce yourself & when you’re taking your exam (approximate timeframe).

REG Study Group Links and Resources:

1. NINJA Monthly – Full REG Course for $67/mo
2. How to Study for REG with NINJA Only
3. How to Pass REG in 20 Days
4. How to Retake REG After Failing
5. Video: Study Advice for REG
6. CPA Reviewed Podcast
7. CPA Exam Score Release Dates
8. NINJA MCQ Trending vs Actual REG Scores
9. I Passed the CPA Exam!
10. I Passed REG!
11. NINJA REG SIMS List by Topic
12. Free Downloads: NINJA REG

[Anonymous]

@Starved_Wolf, Ok so in the most basic terms a deduction reduces taxable income whereas a credit reduces tax liability dollar for dollar (Credit is always better).
The specific difference is that state and local income taxes withheld from a paycheck are deductible as itemized deductions. Federal w/h directly offsets income tax liability dollar-for-dollar.

[Starved_Wolf]

@Chandler, Now that makes more sense. I did not know that the credit was for federal withholding taxes. Becker did not mention that in the book at all. The book simply states:

Withholding Tax (Paycheck Credit)
“All income taxes withheld from a taxpayer's paycheck are treated as a “credit” against the taxpayer's liability. When this credit exceeds the tax liability, a refund is generated to the taxpayer.”

[Starved_Wolf]

Porter, the sole shareholder of Preston Corp., transferred property to the corporation as a contribution to capital. 2 year later, Corley transferred property to the corporation in exchange for a 10% interest in corporate stock. The property transferred was valued as follows:
Porters transfer:
Basis: $50,000 FMV: $200,000
Corley’s transfer:
Basis: $25,000 FMV $500,000

Answer is: $550,000
Explanation: Porters transfer is not taxable because the 80% control test is met. Corley’s transfer is taxable because the 80% control test is not met.
Why doesn’t Corley’s transfer meet the 80% control test when there are only 2 shareholders and both of their interests combined (90% Porter and 10% Corley) exceed 80%?

[Supported by him]

In order to meet the 80% test both should “Immediately after the contribution” to the corp. own 80% or more. However, the question states that “2 years later” Corely transferred … so, it is NOT possible to combine their interests together after 2 years.

[Alex]

Hello! I am struggling in identifying the difference between contemporaneous exchange for new value and preferential payment. Can you give me few examples of Contemporaneous exchanges? Thank you!

[Starved_Wolf]

Holy Cow…this is an overwhelming amount of material to remember.

[Starved_Wolf]

Can someone please explain inside/outside basis to me? Specifically as it relates to the section 754 election and section 743(b) basis adjustment?

[El_Stillo]

looking for some hope here from my fellow ninjas. Are the reg sims in Wiley a fair repreentation of the exam? I feel like I have MCQ's down but boy do I struggle with these sims. I take the test on the 8th and the I'm making only marginal improvemnts on these sims. Anyone have any last minute advice on the sims. Its beomce a sobering reality that after weeks of practice this stuff isn't sticking.

BTW – if I get an AMT Sim I'm likely to throw the computer out the window on Saturday.

[amens]

@el_stillo here’s a link to a post someone created about potential sims based on the Aicpa blueprint https://www.another71.com/cpa-exam-forum/topic/potential-reg-sim-topics-from-the-aicpa/.
Also, the Aicpa sample test simulations are a great representation of what to expect. Learn the ins and outs and explanation for their answers.

[El_Stillo]

@amens good stuff i'll hammer this all week.
anyone using wiley in this thread, thoughts on their reg product?

[Operation_CPA]

I sit for REG on Friday – hoping to come out of my last exam victorious so I can finally be done with this journey. Currently trending 79% on my NINJA MCQ with an average score of 72%. I've done every single tax related question. Starting to get a bit more confident the closer I get to the exam. Praying for reasonable TBS!! Is anyone else sitting this week?

[Anonymous]

@Operation_CPA, I sit for REG on Friday too. After rewriting almost all of Becker twice, I am beginning to feel hopeful. I haven't done all the Ninja MCQs–too many in Business Law!!–but my trending is good too. I have never practiced TBS before, but I am doing it this time. Becker's Skillmaster videos are sometimes good and sometimes useless. Keep going and have faith.
Haven't been able to figure out the signature …
BEC: 80
AUD: 86
FAR: Retake July 2018, waiting to hear

[Anonymous]

@starved_wolf, been a few days but thought I would take a stab at inside vs. outside basis.
Outside basis is each partner's basis in their partnership interest.
Inside basis is each partner's basis in the assets inside the partnership.
Under normal circumstances, we would expect these to be the same. However, when an interest is transferred or new partners are admitted this can change. The typical example of this is that a partner joins the partnership a few years (or many) after it has started. Say that the partnership's assets have a FMV of $200,000, but only a tax basis of $100,000. We would expect this new partner to contribute $50,000 for a 20% interest in the partnership (his capital is 1/5 of assets immediately after contribution). However, his “inside basis” in the assets will be only $30,000 ($100,000+50,000*.20). This creates inequity as he gets smaller amortization and depreciation deductions (since they are based on tax basis instead of FMV). Section 754 and 743(b) elections allow a partner to reconcile inside basis to outside basis. As I previously mentioned this allows the new partner the benefit of increased depreciation and amortization deductions.

Also, inside basis can go negative, but outside basis never can. However §754/743 do not directly have anything to do with this. I can explain these to you in much more detail, but honestly application and nuances of these are beyond the scope of what you can expect to see on the CPA exam IMO.

[Anonymous]

I am going through questions and seeing differences regarding exemptions for over 65. I am using the Wiley textbook and it is 2017. Which states there is extra exemption over 65 or blind. Some of the questions are showing there is no extra exemption for being 65 or older. Is it just that they get the higher standard deduction? Just want to make sure I have a firm handle on this when I take my test on Saturday.

[Kgal]

Hi everyone I’m a newbie here. I just took REG this morning….. and think I’ll be taking it again. It was very heavy on the material I was least comfortable with, of course. Almost no business law or ethics, which I was strongly prepared for. Very little individual taxation. I’m pretty bummed!!! I think scores are released after the window closes?

[Author]

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