[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]

this is the explanation in ninja for that question:

Beginning in 1998, individuals are not considered participants in a company retirement plan simply because their spouses are. However, the maximum deductible IRA contribution for a nonparticipant spouse is phased out for couples with joint return adjusted gross incomes between $181,000 and $191,000. In this case, the Spanos' AGI is $4,000 over the beginning of the $10,000 phaseout range so their maximum $4,000 deduction is reduced by $800 ($4,000 × 2 ÷ 10) to arrive at $3,200.

I understand taking 4000, but what is 4000 *2/10?

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

[Anonymous]

@Someday – I feel the same way. An 80% is great average!

[Anonymous]

OK. Then I am going to chalk that question up to being bad since neither Becker or Ninja explain where the .2 comes from. I'll check my Wiley book for clarification when I get home, but I'm not going to worry about it aside from remember .2 in case they have an equally bad question on the exam. I assume it is an AICPA released question since Becker and Ninja both have it. Maybe they threw the question out because it sucked. 🙂

[WANNABE_CPA]

@you all are misunderstanding my 80% …it was just the individual tax part i am comfortable with after reading all, i have still not touched AMT, credits and all other small things which if i try without going through material i will get 0 average…lol …But i still felt good for 1 sec hehe

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

[SomedayCPA2015]

Whoa I am more confused now than I was before! I cannot figure this out either. I'm glad we are talking it out since I was just using 20% much like the medical expense 10% AGI threshold. I'm feeling the same way Mommy about this question. I tend to get obsessed over things like this and then spend too much time on that when it would be better spent someplace else.

REG - Passed
BEC - Passed
AUD - Passed
FAR - Passed!!!! I have my life back.

[SomedayCPA2015]

lol Wannabe. You should still feel great! 🙂 I'm always coming on here and checking out the quizzes, but I just don't have a lot of time to participate. I'm slow at work today, so I can actually think for a minute today which is nice. 😉

REG - Passed
BEC - Passed
AUD - Passed
FAR - Passed!!!! I have my life back.

[WANNABE_CPA]

@mommy…i read an article on IRA deductions and they had explained about this phase out in between amount which i understood after reading then , let me find out what it said…It has all blanked out by now.

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

[WANNABE_CPA]

i cant find it….now its frustrating 🙁

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

[WANNABE_CPA]

@mommy, remember when we did like kind exchange basis quiz, Didnt we get to a conclusion from a question that said, that if there is a boot received as well as boot paid, it is netted to compare with Realized gain to know how much is Recognized gain.

Suppose: Realized gain is $3000, Boot received of $3500, Boot paid of $1000.

I dont know why i think i settled on Netting the boot received and paid which will be $2500

Compare $3000 and $2500… Gain recognized is $2500

This is the Question in which trailer is exchanged as boot for $3500 and taxpayer is paying $1000 cash. I got this wrong now, and i remember we discussed it alot. i dont know why i feel it should be netted.

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

[SullivanNJD]

@ wanna

do you have the full example?

FAR- 87
REG- 81
AUD- 88
BEC-

Who's Better Than Us? nobody

[Anonymous]

Im confused on the IRA phase-outs as well. Is the phase-out percentage applied against the actual contribution (when contributions are below $5500) or the maximum limit of $5500?

[Anonymous]

@Wannabe – I have in my notes that: Realized Gain = Old Basis + Boot Paid – Gain recognized – Boot Received

[WANNABE_CPA]

@sullivan

Facts of the question: Automobile exchange for automobile used for business.

Given automobile: Cost $35000, $18000 depreciation, FMV $20000.

Received automobile: FMV $17500.

Taxpayer also gets Trailer worth $3500

Taxpayer gives $1000 cash in addition.

What is the taxpayer's Basis in the new automobile received?

A.17000

B.19500

C.14500

D.17500

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

[SullivanNJD]

So heres how I think its done

Realized Gain (17,000 + 1,000) – (17,500 +3,500) = 3,000

Recognized Gain: Lesser of Realized (3,000) or Net Boot Received of (2,500) – So, 2,500

Deferred gain of 500

Basis in new automobile: 17,500 FMV – 500 Deferred Gain = 17,000

FAR- 87
REG- 81
AUD- 88
BEC-

Who's Better Than Us? nobody

[WANNABE_CPA]

@sullivan…Thats what my issue is..I get $17000, and i thought Recognized gain will be $2500… But the answer to this question is $17500 which they calculate by taking $3000 as Recognized gain(lesser of $3000 or $3500).

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

[Author]

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