[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

[jonm857]

Sonja… yes, pleassssse share your summary of basis & distributions. I would really like to take a look at that.

B - 81
A - 87
R - 73
F - July 5th

[Reg_Slayer]

there are 2 methods for UNDERPAYMENT PENALTIES, but I have see different words associated w them.

prior yr method = seasonal method?
and
annualized method = current yr method?

[jonm857]

my understanding is that 90% of CY and 100% of PY are both annualized methods, whereas the seasonal method isnt allowed for computing estimated tax payments……………… i'm confused

B - 81
A - 87
R - 73
F - July 5th

[sonja90]

@jon i sent you an email because i made it in excel. Not sure how to share it here. Please feel free if you know 🙂

[Reg_Slayer]

C-CORP

The charitable contribution deduction is the lesser of:

1. The amount of the charitable contribution
2. 10% of preliminary TI

[jonm857]

Edge Corp. met the stock ownership requirements of a personal holding company. What sources of income must Edge consider to determine if the income requirements for a personal holding company have been met?

I. Interest earned on tax-exempt obligations.
II. Dividends received from an unrelated domestic corporation.

a. Neither I nor II.
b. Both I and II.
c. I only.
d. II only.

B - 81
A - 87
R - 73
F - July 5th

[Reg_Slayer]

c?

[jonm857]

D is the answer. Here is the solution:

Choice “d” is correct.
I. Interest is normally included in personal holding company income, but only if it is included in the receiving corporation's gross income. Since interest income from tax-exempt obligations is not included in gross income, it is not personal holding company income.

II. Dividend income from unrelated domestic corporations is personal holding company income.

B - 81
A - 87
R - 73
F - July 5th

[sonja90]

@reg that's correct
@jon is it B?

[jpowell31]

D)

i did brilliant on ninja practice sims then took the practice AICPA test online where it took flipping AGES to load and navigate and gave me NIGHTMARE FLASHBACKS. not sure if it was a good idea or not to have done that the day before.. i panic now. but really i'll just do progress tests and read my notes and try to go to sleep.

[Anonymous]

catching up…

@jonm857 – I found the illegal business rules to be interesting when we covered them in class. We were told that these were the rules the IRS created so that after they caught someone, they could figure out how much in taxes were owed. Today, it is being used by marijuana dispensaries that are legal per the state but illegal per federal laws.

@Reg_Slayer – gain recognized in a like-kind exchange is actually the lesser of boot received or gain realized. Also, your basis equation is good for many problems, but is missing a couple of pieces.
new basis = old BV + boot paid – boot rcvd + gain recognized.
Or, new basis = new FMV – gain deferred + loss deferred

@aatoural – jonm857 is correct. The mid-quarter convention is only used when ≥ 40% of personal property is placed into service in the last quarter. The building is real property, so it doesn’t count. Buildings are always depreciated using straight-line (not MACRS) and the mid-month convention; you use 27.5 yrs (I think… yes, I checked) if it is for residential use or 39 years if it is for commercial use

[Reg_Slayer]

preliminary TI
-charitable contributions
+dividends received
– DRD [70%/80% (0-20%/20-80%)]
=
TI

[jonm857]

@reg_slayer

I think you add dividends received to taxable income before calculating the charitable deduction

B - 81
A - 87
R - 73
F - July 5th

[jonm857]

@jpowell

Best of luck tomorrow! you will do fine. be sure to let that test know that I am coming to kick it's @$$ in a few days for revenge!

B - 81
A - 87
R - 73
F - July 5th

[Reg_Slayer]

GAINS, C-corps

receive cash boot from c-corp:
realize & recognize

donate property to c-corp [fmv>basis]
recognize, but don't realize

???

[Author]

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