Brainscape's Knowledge GenomeTM

Browse over 1 million classes created by top students, professors, publishers, and experts.


See full index

Undeleted > Final Review > Flashcards

Final Review Flashcards

1
Q

What is the basis in stock repurchased resulting from a wash sales?

A

cost of replacement + disallowed loss

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

Is a bank liable to the drawer if failure to obey a stop pay did not cause a loss?

A

No

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

What is the basis in a new building that was destroyed and insurance was received for the loss?

A

Cost to rebuild

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

Equation for Like-Kind Exchange

A

(+) Basis Given Up
(–) Boot Received
(+) Gain Recognized

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

What is the distribution amount to a shareholder for property received with a liability to be assumed?

A

FMV of property - Liability assumed = Distribution

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

Sec 1231 gain recapture as ordinary income is for how many preceding years?

A

5 years

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

“Fit for all of the purposes for which the buyer intends to use the goods” is what type of warranty?

A

Merchantability

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

Term used to avoid liability under SEC 1933

A

Due Diligence

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

Does “Composition of Creditors” release the debtor from debt?

A

Yes

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

Can a charitable contribution increase or create a NOL?

A

No, charitable contributions are not part of a NOL

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

If it’s not clear if a property is joint tenancy or tenancy in common what is the default?

A

Tenancy in Common

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

Lessee purchasing the leased property does what to the lease?

A

Terminates it

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

Basis in partnership for a partner contributing services and property

A

FMV of Partnership interest - PMV Property Given = Income

BASIS = Income + Property AB

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

Does a buyer in the ordinary course of business take free of any security interest, even if perfected?

A

Yes

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

Are limited partners liable for who’s negligence?

A

Their own and who they supervise

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

What must be proven to claim fraud in the inducement?

A

The defendant made a false statement with intent to deceive

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
17
Q

For a service contract where additional work is requested for additional pay, and the contract is over $500, is this binding?

A

Yes, additional pay is additional consideration

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
18
Q

Can a consumer recover from a manufacture even if they can not prove negligence?

A

Yes

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
19
Q

Shareholder’s basis in corporation when transferring property, equation

A 
(+) Adjusted Basis
(+) Gain Recognized
(--) Boot Received
(--) Liabilities Assumed
(=) Basis in Corporation
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
20
Q

Corporation’s basis in property contributed by Shareholder, equation

A

(+) Shareholder’s Adjusted Basis

(+) Gain recognized by the Shareholder

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
21
Q

Holding period for Shareholder in property contributed to corporation

A
  1. Capital or Sec 1231 - tack on

2. All of property - day of contribution

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
22
Q

Holding period for Corporation of property contributed

A

Tack-On Shareholder’s

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
23
Q

Realized Gain or Loss Equation

A

(+) Amount Realized
(–) Adjusted Basis
(=) Realized Gain/Loss

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
24
Q

Amounts Realized include what 4 items?

A
  1. Cash
  2. FMV of Property
  3. Liabilities Assumed
  4. Less: Selling Expense
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
25
Q

Are losses on personal assets deductible?

A

No

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
26
Q

Contributing Inventory to a corporation is what type of asset and what holding period will it take

A

Ordinary, Tack-On holding period

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
27
Q

No gain or loss recognized to the Shareholder in a corporate formation when what occurs?

A
  • **80% rule is first test
    a. Stock is the only property received
    b. Stock is received in exchange for cash or property only, no services
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
28
Q

If boot is received in a corporate formation what is the amount of boot?

A

Lower of:

a. Realized Gain
b. FMV of Boot

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
29
Q

When can you not compute realized gain?

A

You can always compute realized gain, but it’s not always recognized (ex. 80% test)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
30
Q

If debt assumed by a corporation is greater than the AB of property contributed by the shareholder what is the gain amount?

A

Gain = Debt Assumed – Adjusted Basis of Property

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
31
Q

How are Guaranteed Payments accounted for in Partnerships?

A

Deducted from Ordinary Income

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
32
Q

When are “Hot Assets” accounted for?

A

Only on Sale or Termination of Partnership Interest, not non liquidating distribution

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
33
Q

Can basis in a Partnership go below Zero?

A

NO

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
34
Q

What triggers an accrual basis tax payer?

A

Average over $5mill for 3 years

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
35
Q

What is the tax return form for a S-Corp

A

1120-S

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
36
Q

What or the Ordering Rules

A
  1. Net Income
  2. Distributions
  3. Losses
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
37
Q

TRP Penalty (not client penalty) for taking an “unreasonable position”, not willfuly

A

Greater of:

a. $1,000
b. 50% of income received from client

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
38
Q

TRP Penalty (not client penalty) for taking an “unreasonable position”, WILLFULLY

A

Greater of:

a. $5,000
b. 50% of income received from client

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
39
Q

How are medical expenses paid for a dependent deducted (For AGI or Misc Itemized Deduction)

A

For AGI

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
40
Q

How are expenses related to passive rental income deducted?

A

Schedule E, above the line

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
41
Q

Are gambling losses an itemized deduction subject to the 2% floor?

A

No, not subject to the 10% floor

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
42
Q

Child tax credit per child

A

$1,000

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
43
Q

How is the child tax credit phased out?

A

$50 for every $1,000 over, rounded up to the next $1,000

44
Q

Is a scholarship that goes directly to tuition and fees taxable?

A

No

45
Q

Fraud in the inducement is what type of defense?

A

Personal Defense

46
Q

Tax Payer penalty for Under Reporting Income - Negligently

A

20% of tax due

47
Q

Tax Payer penalty for Under Reporting Income - Fraud

A

75% of tax due

48
Q

Tax Payer Failure to File Penalty

A

5% a month, not to exceed 25% of tax due

49
Q

Tax Payer Failure to Pay Penalty

A

0.5% a month, not to exceed 25% of tax due

50
Q

Is the appreciation of property since the time a debtor filed bankruptcy part of the estate?

A

Yes

51
Q

3 items included in Bankruptcy estate if received after 180 of filing

A
  1. Inheritance or Gift
  2. Divorce, Separation, or Property Settlement
  3. Beneficiary Proceeds from Life Insurance
52
Q

Interest Income received on a mortgage loan is recorded on what schedule?

A

B

53
Q

Computation of Self-Employment tax is based on what?

A

Net Earnings from Self-Employment

54
Q

How is a net loss in an Asset Group applied to other asset groups?

A

Starting with the highest tax rate and moving down

55
Q

When is the only time that the 60% rule of a secured party reposes collateral and having to sale it apply?

A

Consumer Goods

56
Q

If a party take a note in “good-faith” they probably are what?

A

Holder in Due Course

57
Q

If a negotiable instrument does not have a stated time that it pays when is it payable?

A

On demand

58
Q

Official Bonds are the obligation of who?

A

The surety

59
Q

When and how much can a noncorporate shareholder exclude gains from the sale of Qualified Small Business Stock?

A

Held after 5 years, 50% of the gain

60
Q

Does a general partner in a limited partnership have the same rights as a general partner in a general partnership?

A

Yes

61
Q

Past and Present owners of Environmentally Damaged property have what type of liability?

A

Joint & Several, all can be held liable for the whole thing

62
Q

If a partner sales property to a partnership, not acting as a partner, they can recognize a gain or loss unless what situation?

A

They own 50% or more of the partnership

63
Q

If an issuer has less than 35 unaccredited investors they qualify for which Reg D section

A

All 3; 504, 505, 506

64
Q

When would a limited partner have a liability to a limited partnership on dissolution?

A

If the limited partnership as a receivable from the limited partner

65
Q

Can a loss be recognized by a corporation for a non-liquidating distribution?

A

No, no loss on non-liqudating

66
Q

When would a shareholder on a corporate formation defer a gain vs. recognize a gain?

A

Defer if part of the 80% “Control Club”

Recognize if not part of 80% or boot is received

67
Q

Who is a “Tax Delinquency” penalty imposed on?

A

Someone who owes taxes but does not file a return

68
Q

AMT Exemption amount equation

A

$40,000 - (25% over $150,000 AGI)

69
Q

What is the standard deduction for Trust/Estates?

A

ZERO

70
Q

Debt acquire by a corporation that is greater than the AB of property contributed results in what?

A

Gain to shareholder

71
Q

“Hot Assets” result in what type of income?

A

Ordinary

72
Q

Can a partner take a partnership loss that exceeds their basis?

A

No, it’s carried forward

73
Q

When is a S-Corp shareholder’s basis increased for debt and when is it not?

A

Shareholder contributes debt - Increase

S-Corp gets own debt - Does NOT Increase

74
Q

What is the tax treatment of Education IRA for contributions and withdrawals?

A

Contributions - NOT deductible

Withdrawals - Tax FREE for qualified education expense

75
Q

Credit for AMT can be carried back/forward how long and can offset what?

A

Forward only, indefinitely

Only Offsets Regular Tax

76
Q

Can Self-Employed individuals deduct their own salary as a business expense?

A

No

77
Q

What tax form does a partnership file?

A

Form 1065

78
Q

Limited Partners basis increase for what type of debt?

A

Non-recourse only

No change for Recourse debt

79
Q

What are the 4 criteria for “Small Business Stock”

A
  1. Held for 5 years
  2. Corporation less than $50 million capital
  3. 50% gain excluded
  4. 28% tax rate on gain
80
Q

Section 1244 gain and loss treatment

A

Gain - Capital Gain

Loss - Ordinary loss

81
Q

When a shareholder buys property from a corporation for less than FMV what did the shareholder receive?

A

Constructive Dividend

82
Q

What is the difference between a check and a negotiable time draft?

A

Negotiable time draft is payable at a definite time in the future, but is a 3 party instrument like a check

83
Q

Does a buyer in the Ordinary Course of Business take free of any perfect security interest?

A

Yes

84
Q

What amount of loss is allowed if partnership property is sold to an individual partner that owns more than 50% of the partnership?

A

Zero

85
Q

If a merchant contracts to buy 100 lbs of gold over 6 months and circumstances change do they have to buy all 100 lbs?

A

Yes

86
Q

Loss related to the sale of a subsidiary (80% ownership) is what type of loss to a corporation?

A

Ordinary

87
Q

Do Limited Partners owe a fiduciary duty to the partnership?

A

No

88
Q

What is the automatic start up and/or organizational cost deduction before amortization? What is it’s limit?

A

$5,000

Anything amount over $50,000 if phased out dollar for dollar

89
Q

How is investment interest expense that does not exceed net investment income deducted?

A

Fully deductibe

90
Q

What is the max amount that can be raised through crowd funding for a EGC?

A

$1 million

91
Q

How is Interest on Tax-Exempt income treated for Personal Holding Tax?

A

Excluded

92
Q

The term for basis used to determine gain on sale of property that was received as a gift

A

Transferred Basis

93
Q

What is the only way that a Firm Offer is created?

A

MERCHANT makes a offer by SIGNED writing

94
Q

For federal estate tax is a created allowed for state death taxes paid?

A

No

95
Q

What is the term for the maximum amount of income taxable to beneficiaries of a trust?

A

DNI

96
Q

Do trust or estate received a standard deduction?

A

NO

97
Q

How is all depreciation on Section 1245 property recaptured?

A

Ordinary Income, even if over straight-line

98
Q

Uniform Capitalization applies to who?

A

3 years averaging over $10 million gross receipts

99
Q

Do you use a partner’s outside or capital basis in the partnership to calculate gain or loss on termination?

A

Outside Basis

100
Q

S-Corp Eligibility rules for entities

A
  1. No Foreign corporations
  2. Members of consolidated group aren’t eligible
  3. Can own 80% or more of a C-Corp
  4. My own a S-Corp
101
Q

Shareholder Requirements of an S-Corp

A
  1. Nonresident aliens, C-Corps, and Partnerships are not eligible
  2. Estates can be shareholders
  3. Trust can be shareholders
102
Q

How many corporate shareholders have to vote for an S-Corp to be effective? How many to terminate?

A

Unanimous consent - Effective

Majority - Terminate

103
Q

Can an S-Corp have a tax year other than a calendar tax year?

A

Yes

104
Q

Are shareholder’s of a s-corp liable for an S-Corps debt?

A

No

105
Q

Do S-Corps pay AMT, Personal Holding Tax, or Accumulated earnings tax?

A

No

106
Q

Are S-Corps entitled to normal C-Corp deductions, such as the DRD?

A

No

Undeleted (57 decks)

Brainscape helps you reach your goals faster, through stronger study habits.
© 2024 Bold Learning Solutions. Terms and Conditions