[jeff]

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

[Mamabear]

My question had a couple of parts so I'll repost the question and give you the second and third questions that went with it:

Laura's father, Albert, gave laura a gift of 500 shares of stock in 2012. Albert's basis for the stock was $4K. At the date of this gift, the FMV of the stock was $3K.

If Laura sells the 500 shares of stock in 2013 for $2K, her basis is

A $4K

B $3K

C $2K

D $0

If Laura sells the shares of stock in 2013 for $3,500, what is the reportable Gain or Loss in 2013?

A $3,500 gain

B $500 Gain

C $500 Loss

D $0

CPA Exam - Finally DONE (November 2014)
BEC (08/10/13) 80
AUD (08/24/13) 65 (11/13/13) 85
FAR (04/12/14) 81
REG (07/19/14) 69 (11/29/14) 87!!

[Mamabear]

@tax Lady–$100 of LTCG?

CPA Exam - Finally DONE (November 2014)
BEC (08/10/13) 80
AUD (08/24/13) 65 (11/13/13) 85
FAR (04/12/14) 81
REG (07/19/14) 69 (11/29/14) 87!!

[Tax lady]

@wannabe B?

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

[Mamabear]

@wannabe–A

CPA Exam - Finally DONE (November 2014)
BEC (08/10/13) 80
AUD (08/24/13) 65 (11/13/13) 85
FAR (04/12/14) 81
REG (07/19/14) 69 (11/29/14) 87!!

[Tax lady]

@mama that's what I thought but it's D since it fell in between the two basis'

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

[WANNABE_CPA]

@taxlady, i think Zero, as this one has Lower FMV and i between Selling price

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

[Mamabear]

Dang. I forgot that little detail. 🙁

CPA Exam - Finally DONE (November 2014)
BEC (08/10/13) 80
AUD (08/24/13) 65 (11/13/13) 85
FAR (04/12/14) 81
REG (07/19/14) 69 (11/29/14) 87!!

[WANNABE_CPA]

Ans to my ques is A, but why?

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

[Tax lady]

@mama part 1, D; part 2, B?

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

[WANNABE_CPA]

if i use the method i use, it comes out $38000, not even in choices lol

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

[Tax lady]

@wannabe. I have no idea. I thought I understood it but I'm coming up with 38K after I re-work it.

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

[Mamabear]

I used the same formula from earlier. New basis = old basis + recognized gain – boot received = $40K + 6K – 6K. The recognized gain is the lesser of the realized gain ($10K) and the boot ($6K)

CPA Exam - Finally DONE (November 2014)
BEC (08/10/13) 80
AUD (08/24/13) 65 (11/13/13) 85
FAR (04/12/14) 81
REG (07/19/14) 69 (11/29/14) 87!!

[WANNABE_CPA]

so is it that, i should drop this method and use other, and how do i show my face to mamabear ???

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

[WANNABE_CPA]

Property may be sold by a father to a daughter at any price. When is the transaction not allowed to be recognized for tax purposes?

A.

When the sale is for a profit

B.

When the father breaks even on the sale

C.

When the father loses money

D.

All of the answer choices are allowed.

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

[Mamabear]

It was back from when I said that unless the realized gain is more than the boot, the new basis will always equal the old basis and tax lady said she had googled something that said it usually is equal. Unless I'm thinking of a different type of problem. My theory is when in doubt, go with the old basis.

CPA Exam - Finally DONE (November 2014)
BEC (08/10/13) 80
AUD (08/24/13) 65 (11/13/13) 85
FAR (04/12/14) 81
REG (07/19/14) 69 (11/29/14) 87!!

[Author]

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