[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/

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

[WANNABE_CPA]

Tom Lewis, an individual taxpayer, performs services for the Red Cross in 2014 at an out-of-town location for three weekends during the year. There was no significant element of personal pleasure for Tom on these weekend trips. He incurred the following expenses in relation to these trips:

Special uniform worn while performing services $100

Meals and lodging while on weekend trips $300

How much of the expenses may Tom deduct as a charitable donation on his Schedule A (itemized deduction) form for 2014 (assuming that he can fully itemize and deduct all such expenses)?

A.

$0

B.

$100

C.

$300

D.

$400

FAR : 68, 74, 83 Thank you God 🙂
BEC : 78 (8/27) 🙂
REG : 72 ,80 (2/25) 🙂
AUD : 69,67, 07/23

[CPAfit]

@wanna is the answer B. $100?

[Anonymous]

D

[WANNABE_CPA]

Ans is D

Both of these items (the uniform worn while performing charitable services and the meals and lodging while on the weekend trips performing the charitable services) are deductible as charitable contributions.

FAR : 68, 74, 83 Thank you God 🙂
BEC : 78 (8/27) 🙂
REG : 72 ,80 (2/25) 🙂
AUD : 69,67, 07/23

[pia ach]

@cpamommy you did not sleep at all?? wow i can never do that, after sleeping at 6 i just got up an hour back..am on EST…i need my sleep, i become totally dysfunctional if not. Today i do taxes. Well Reg was the only one exam i passed on my first attempt, so in the beginning i was overconfident while studying but now i realize BIG mistake :)..i think i work best when under pressure.

By the way i got the Titan question i posted early in the morning in another book and the explanation says on a note Drawer only has secondary liability , so till the drawee accepts/certifies the check no one has liability hence the answer was neither the bank or drawer. Just not gonna overthink about it and memorize!

Finally done!!! Experience-pending. Ethics- Pending.
Reg 78 / 73/82.
Aud 74/89.
BEC 72 /78.
FAR 74/ 73/ 82.

[Anonymous]

[Anonymous]

@wannabe- how are either of those expenses deductible under chartiable contributions?

[WANNABE_CPA]

Destry, a single taxpayer, reported the following on his U.S. Individual Income Tax Return (Form 1040):

Income:

Wages $5,000

Interest on savings account 1,000

Net rental income 4,000

Deductions:

Personal exemption $ 3,950

Standard deduction 6,200

Net business loss 16,000

Net short-term capital loss 2,000

What is Destry's net operating loss that is available for carryback or carryforward?

A.

$7,000

B.

$9,000

C.

$15,700

D.

$16,000

FAR : 68, 74, 83 Thank you God 🙂
BEC : 78 (8/27) 🙂
REG : 72 ,80 (2/25) 🙂
AUD : 69,67, 07/23

[CPAfit]

@wanna D. $16000

[Anonymous]

@Wannabe – B

[WANNABE_CPA]

@cpamommy…You really pulled out an all nighter last night….that is awesome..You might be really tired and you are working now, so did you stand through the meeting?

..i tried, but coffee didnt do its trick and i dont like it much too, made me get all weird feeling in my stomach. Simulations were not going that great, so got tired and made another study plan (that i do every other day) and slept..

I am hoping to get through big chunk of Mcqs today, plus law, plus simulations…I am down 50 mcqs of Individual from Ninja…so might be a good study day today.

FAR : 68, 74, 83 Thank you God 🙂
BEC : 78 (8/27) 🙂
REG : 72 ,80 (2/25) 🙂
AUD : 69,67, 07/23

[WANNABE_CPA]

Ans is A:

The interest income (nonbusiness income) is offset by nonbusiness expenses, up to the amount of nonbusiness income. The standard deduction is a nonbusiness expense for this purpose.

IRC Section 172(d)(4)

The net capital loss (nonbusiness) is only deductible to the extent it is offset by nonbusiness capital gains.

IRC Section 172(d)(2)

Personal exemptions and unused personal deductions are added back to taxable income in arriving at net operating losses so they do not increase the carryback or carryforward.

The net business loss must be offset by wages and rental income for this year.

IRC Section 172

Wages of $5,000 plus net rental income of $4,000 minus the loss of $16,000 equals a net operating loss carryback or carryforward of $7,000.

FAR : 68, 74, 83 Thank you God 🙂
BEC : 78 (8/27) 🙂
REG : 72 ,80 (2/25) 🙂
AUD : 69,67, 07/23

[WANNABE_CPA]

Please explain if you understand that one

FAR : 68, 74, 83 Thank you God 🙂
BEC : 78 (8/27) 🙂
REG : 72 ,80 (2/25) 🙂
AUD : 69,67, 07/23

[Anonymous]

@Wannabe – That one was TOUGH! I know the passive losses vs passive income rules, but I didn't know about taking the standard deduction against interest income. I have no idea how they get to that answer.

[Anonymous]

Following are a list of donations made during the current year. Which is a tax deductible contribution by the donor? Assume all recipients are qualified charities.

A Bob is a carpenter who works three to four hours each week doing carpentry work at the local homeless shelter. He normally charges $40 per hour for his work.

B Nancy donated $100 to the local fire department. In exchange, she received a coupon book for 10 car washes at the Bubbles car wash. Bubbles normally sell the same coupon books for $150.

C Harry owns several rental properties. He lets the local youth group use a suite of offices free of charge. Bob gets $3,000 in rent per month for similar suite.

D Zachary made a large donation to a nearby university. In exchange he receives the right to purchase football tickets for the upcoming season.

[Author]

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