[jeff]

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

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

[Tax lady]

Crap. I forgot DRD. I figured I was forgetting something. UGH

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]

On January 1, 2014, Carlt created a $300,000 trust that provided his mother with a lifetime income interest starting on January 1, 2014, with the remainder interest to go to his son. Carlt expressly retained the power to revoke both the income interest and the remainder interest at any time. Who will be taxed on the trust's 2014 income?

A.

Carlt's mother

B.

Carlt's son

C.

Carlt

D.

The trust

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

[Anonymous]

@CPAOneDay – My notes have that Partnerships Non-liquidating distributions generally do not recognize Gains/Losses. Partnership liquidating distributions recognize gains when cash is greater than the partner's basis, but basis cannot be reduced below $0.

[Mamabear]

CPAONEDAY posted this at the bottom of the last page:

Can someone please summarize these 4 ponts for me in terms of recognizing gains/losses?? I feel like I'm always messing them up in m/c and I just want to fully understand this going into my exam on Thursday.

1) Non-liquidating distribution – Corps

2) Liquidating distribution – Corps

3) Non-liquidating distribution – Partnerships

4) Liquidating distribution – Partnerships

Can anyone help?

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]

@wanna D

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]

Wiley says that parter recognizes loss ONLY upon complete liquidation of a partnership interest through receipt of only money, unrealized receivables, or inventory. The amount of loss is the basis for the partner's p-ship interest less the money and the p-ship's basis in the unrealized receivables and inventory received by the partner. The loss is generally treated as a capital loss.

In non-liquidating (current) distributions, a partner's basis in distributed property is generally the same as the p-ship's former basis in the property, but is limited to the basis for the partner's p-ship interest less any money received.

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 is C ..

While the trust will receive the income, it is then paid out to Carlt's mother currently (IRC Sections 671 and 674). Because Carlt retained the power to revoke the income interest and the remainder interest, he still controls the trust and he will be taxed on the trust income.

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

[Mamabear]

@wanna–C because he has the right to revoke the trust so he is taxed on it.

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]

Income in respect of a cash-basis decedent:

A.

covers income earned before the taxpayer’s death but not collected until after death.

B.

receives a stepped-up basis in the decedent’s estate.

C.

must be included in the decedent’s final income tax return.

D.

cannot receive capital gain treatment.

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

[Anonymous]

@Wannabe – A

[Mamabear]

Carr's admission to the Smith & Jones p-ship on 07/01/13:

Carr's contribution of capital: 800 shares of Ed Corp stock bought in 1999 for $30K; FMV $150,000 on 07/01/13

Carr's interest in capital and profits of Smith & Jones: 25%

FMV of net assets of Smith & Jones on 07/01/13 after Carr's admission: $600K

Carr's gain in 2013 on the exchange of the Ed Corp Stock for Carr's p-ship interest was

A $120K ordinary income

B $120K LTCG

C $120K Section 1231 gain

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!!

[Tax lady]

@wanna C

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]

Ok guys. Need help. Why is C wrong?

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

[Anonymous]

@Mamabear – D?

[Author]

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