Deck 30 Flashcards
Priority disputes between secured party and buyer of consumer goods from consumer goods:
Buyer of consumer goods from consumer prevails only if the secured party doesn’t file a financing statement
20-day grace period for a PMSI only works for:
Inventory
Interest on auto loans is:
Not deductible
Deduction for personal residence interest is an:
Itemized deduction
For a personal residence that is not used for rental purposes, no deduction is allowed for:
Utilities and insurance
Max section 1244 loss that can be deducted is:
$50,000
The at-risk limitation provisions may limit:
A partner’s deduction for his or her distributive share of partnership losses
What is the first step when figuring out gain/loss for a stock split?
Figure out the amount of the original purchase (original basis)
2:1 Stock split
Number of shares double
3:2 stock split
Multiply the shares by 3, then divide by 2
Basis for a tax-reorganization
Basis of the stock that the taxpayer surrendered (Surrendered 4000 shares, $4000 basis)
Section 1245 property examples
Equipment and office furniture (not building)
Separately stated income for partnership includes:
Dividends received, long-term capital gains (taxable to partners), and investment interest expense (deductible by partners)
A reorganization under Ch. 11 bankruptcy does not include:
Liquidation
When chapters of bankruptcy is a trustee required?
Chapter 7 and chapter 13 (not ch. 11)
Chapter 7 bankruptcy
Liquidation; trustee appointed; individual, partnership, corp.
Chapter 13 Bankruptcy
Adjustment of debts; individuals only; no liquidation
Chapter 11 bankruptcy
Reorganization; individuals, partnerships, corp.; trustee not required; no liquidation
Exception to who may be a debtor (RIBS):
Railroads; Insurance companies; banks, brokers; savings, stockbroker
Means test calculation
(Average monthly income - allowed expenses) x 60
When is chapter 7 not permitted for an individual consumer debtor?
average current monthly income (6 months) > state median income; and the means test amount is greater than $12,475
Chapter 7 bankruptcy is permitted for an individual consumer debtor when…
Average current monthly income (6 months)
