[jeff]

Welcome to the Q4 2016 CPA Exam Study Group for REG.

If this is your first post in the study group – please post your target exam date (just the time frame to preserve your anonymity), and your past history with this exam (optional, of course).

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

[jeff]

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

[rocky3124]

C.

[Sticky Nicky]

just took aud,,,reg next,,,any tips?

[HoosierCPA]

Paul Pappas owns all of the stock of an S corporation which had previously been a C corporation. The S corporation had the following balances at the beginning of its tax year:

Accumulated adjustments account $ 8,000
Accumulated earnings and profits 10,000

Paul's stock basis was $20,000 at the beginning of the tax year. The S corporation made a distribution of $19,000 to Paul during the year. What is Paul's stock basis at the end of the year?

A.$1,000

B.$2,000

C.$11,000 — CORRECT

D.$12,000

Ninja Explanation:

Paul's basis is reduced by the distribution from accumulated adjustments account, but not by the distribution from accumulated earnings and profits which is taxable income to Paul. The distribution in excess of $18,000 is a tax-free return of capital and reduces Paul's basis ($20,000 – $8,000 – $1,000 = $11,000).

I'm having a hard time understanding the subtracting the $1K–can someone explain in a different way?

FAR - 78
REG - 72,74,71...please just go away REG nobody likes you!
BEC - 82
AUD - Aug 16

[mtaylo24]

Easy – Distributions for SCorps happen in this order 1.) AAA, 2.) AEP, 3.)Return to capital

They distributed 19,000 so the first 8,000 goes to AAA (which reduces basis), then 10,000 goes to AEP as a taxable dividend (no effect on basis), then the rest returns to capital (1k).

20,000 (OG Basis)-8,000(AAA distribution)-1,000(distribution after AAA and AEP) = 11,000 (Adj basis)

AUD - 1st - 60 (12/12), 61 (2/13), 61 (8/13), 78! (11/15)
REG - 55 (2/16) 69 (5/16) Retake(8/16)
BEC - 71(5/16) Retake (9/16)
FAR - (8/16)

[mtaylo24]

What up Sticky Nicky? Glad you survived that beyotch BEC. How was auditing?

AUD - 1st - 60 (12/12), 61 (2/13), 61 (8/13), 78! (11/15)
REG - 55 (2/16) 69 (5/16) Retake(8/16)
BEC - 71(5/16) Retake (9/16)
FAR - (8/16)

[HoosierCPA]

@mtaylo thanks. So most of this I have been trying to go off memory and haven't looked at REG since July 1st so a lot of my knowledge has been lost.

So AAA distributions will always reduce the basis as well as the ROC? And the actual distribution netting against the accumulated earnings is not? I guess I'm not even sure what a accumulated adjustments account is so it's hard to make sense of it.

I may need to go back to my becker book and re-read this material. It's amazing how much you lose after a few months.

FAR - 78
REG - 72,74,71...please just go away REG nobody likes you!
BEC - 82
AUD - Aug 16

[mtaylo24]

@dthatham10 I'm just giving you a hard time. I'm wrapping up this round and taking it tomorrow….I've seen that question at least 15 times using Ninja MCQ at this point. But, I know all about being rusty, I had the worst time re-learning everything this go-round, especially after sitting for BEC twice in a row.

AUD - 1st - 60 (12/12), 61 (2/13), 61 (8/13), 78! (11/15)
REG - 55 (2/16) 69 (5/16) Retake(8/16)
BEC - 71(5/16) Retake (9/16)
FAR - (8/16)

[hasy]

@mtaylo24, looks like you'll crush REG.

Character cannot be developed in ease and quiet. Only through experience of trial and suffering can the soul be strengthened, ambition inspired, and success achieved - Helen Keller

-

BEC 80 (10/23/15)
FAR 72 (4/2/15); 83 (7/11/16)
REG 52 (4/28/15)
AUD (9/9/16)

Roger + NINJA MCQ + WTB

[mtaylo24]

Man, I hope so. I've only banged out 4,400 questions in Ninja MCQ alone, not counting the Gleim sims and MCQs. I'm only trending 78% though, but getting through 100 questions like its nothing. We'll see though….Lady luck has a tendency to doze off while I sit for these exams.

AUD - 1st - 60 (12/12), 61 (2/13), 61 (8/13), 78! (11/15)
REG - 55 (2/16) 69 (5/16) Retake(8/16)
BEC - 71(5/16) Retake (9/16)
FAR - (8/16)

[RE2PECT]

Good luck Mtaylo!! You're due for a win this time. That's a ton of mcq's you did so far. I'm only at like 1600 smh.

FAR: 75 Roger & Ninja (notes/flashcards/audio/MCQ)
AUD: 73, 81
BEC: 71, retake 8/29
REG:

[Sticky Nicky]

mtaylo,,,aduit went well,,,guess ill see what happens on the 22nd,,,either way i have reg on Dec 9th,,so ill be chillin here w you guys for the next month

[HoosierCPA]

Good Luck @mtaylo24! @sticknicky looks like we are sitting the same day. How far are you along in the studying? I'm way behind on where I feel like I should be. It's stressing me out big time.

FAR - 78
REG - 72,74,71...please just go away REG nobody likes you!
BEC - 82
AUD - Aug 16

[Sticky Nicky]

nyc rioting,,and im just here with Roger like f#ck it,,,gimme that 75

[mtaylo24]

Thanks fellaz. Im switching to the beast of the east, FAR next, but it might be a bit of relief after suffering through those Reg Enrolled Agent and BLAW questions, especially in the Gleim TB. I'll be back tomorrow to let you know how it went!

AUD - 1st - 60 (12/12), 61 (2/13), 61 (8/13), 78! (11/15)
REG - 55 (2/16) 69 (5/16) Retake(8/16)
BEC - 71(5/16) Retake (9/16)
FAR - (8/16)

[Author]

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