[jeff]

Free Study Planner, Notes, Audio, Flashcards: https://www.another71.com/cpa-exam-study-plan/

Free CPA Exam Survival Guide: https://www.another71.com/cpa-exam-survival-guide/

[Windel]

@pghpens:

I like @Leglock‘s answer better.

For this round of CPA Jeopardy “I'll take Leglock's answer regarding the ‘garage sale rule' for $500 Alex”

Alex”

[Anonymous]

Involuntary Conversion question

When they are talking about destruction, theft, condemnation of property what does property mean in this context? For example, if my house burns down or car? what if I own a business does that count?

[Windel]

I've always struggled with the CPA Exam research questions and I can never seem to get a grip on what exactly it is that I'm doing wrong. Have any of you figured out how to master this?

[leglock]

yes, house or car burning down would be destruction, but not things caused by your dog like a broken vase due to dog bumping into it. It has to be sudden, etc. and if your dog causes destruction, it is not allowed.

The rules are different if it's personal or business so know the differences between how you calculate the deductible loss for each, but both are deductible.

[jgarcia09]

I had a questions that asked how much would be allowed for 179 deduction on a 120,000 machinary purchase. Purchase was done a single taxpayer who had schedule c business. He had total business income of 260,000. I selected 120,000 as the max is 500,000 for 179 but the correct answear was 25,000. Does someone know why this might be? I know for large cars or suv's its a max of 25,000.

[Tax lady]

$25,000 is the max for 2014 for Sec179. This is the amount being tested.

REG 8/15/14 (73); 11/13/14 (82)-expired 🙁
AUD 5/30/15 (80)
BEC 11/28/15 (75)
FAR 7/30/16

Studying with CPAexcel and Ninja notes/MCQ's/Flashcards

[leglock]

and it begins being phased out if purchases exceed 200,000 for 2014

[Fk]

Which is the best book for Reg

[rzrbkfaith]

@jgarcia09 – $500,000 was the limit for 2013. In 2014, Section 179 was reduced back to its original limit of $25,000.

@Fayas – I am using Becker, but I think there are several on the forum using Wiley as well.

AUD - 99
BEC - 97
REG - 91
FAR - 1/8/16

[Fk]

@jgarcia how did you find Becker for reg ?

[Anonymous]

Anyone seen @mamabear lately?

I know she is testing for REG this window, and I wanted to stop in and say hey.

[Anonymous]

Porter, the sole shareholder of Preston Corp., transferred property to the corporation as contribution to capital. Two years later, Corley transferred property in exchange for a 10% interest in the Corporate stock. The property transferred was valued as follows:

Porter's Transfer:

Basis: $ 50,000

FMV: $200,000

Corley

Basis: $250,000

FMV: $500,000

What amount represents the corporation's basis in the property received?

A- $300,000 (which was my selection)

B- $450,000

C- $700,000

D- $550,000 (correct answer as per Beckers)

As per the explanation, Corley's transfer is taxable because does not met the 80% control test and the basis is the FMV.

My question is Why Corley's does not met the 80% of control test? He exchanged property for a 10% of interest on Corp stock but in general, Porter and Corley interest is 100% ( no services were rendered in order to excluded the shareholder, so I don't understand).

Any help will be very appreciated 🙂

[rzrbkfaith]

If Corley would have contributed at the formation of the corporation, then you could have included it in the 80% test, but because he contributed AFTER the formation of the corporation, he would have to contribute enough to be a 80% shareholder in order to qualify for a nontaxable contribution.

AUD - 99
BEC - 97
REG - 91
FAR - 1/8/16

[Anonymous]

Got it. Thank you so much!!

[Anonymous]

[Author]

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