More Concepts (NINJA) Flashcards

Question

What is the minimum employment period for a worker's wages to qualify for the Work Opportunity Credit?

Answer 1

An employee must work at least 120 hours for the employer to qualify for the credit. The employee must be a member of certain targeted groups, such as ex-felon, high-risk youth, etc.

Answer 2

Have possession of the check. Bearer always = Negotiable upon mere delivery!

Answer 3

Start-up expenses are amounts paid or incurred for: 1. Investigating the creation or acquisition of a business, or 2. Creating an active trade or business, or 3. Activities engaged in for profit and for the production of income before the day on which the active trade or business begins, in anticipation of the activities becoming an active trade or business and which would have been deductible if paid by an existing trade or business. Common types of start up expenses include: - Advertising costs - Salaries and wages paid to employees and their instructors for training before the business actually begins, - Travel and related expenses incurred in the course of finding potential distributors, supplies and customers before the business begins; - Salaries and fees paid to executives and consultants, as well as for professional services, if incurred before the business actually begins, and - Expenses of investigating the creation or acquisition of a trade or business (investigatory expenses). These are the costs incurred in seeking and reviewing prospective businesses before reaching a final decision to acquire or enter any business. Investigatory expenses include expenses for the analysis and survey of potential markets, products, labor supply and transportation facilities as well as advertising and travel to search for new business as well as the cost of audits designed to help decide whether to attempt the acquisition.

Answer 4

Qualified organizational costs related to the creation of a corporation normally would be capitalized. These expenses include: - Legal expenses incurred for the organization of the corporation, such as drafting the corporate charter, by-laws, minutes of organizational meetings, terms of original stock certificates. - Necessary accounting services - Expenses of temporary directors and of organizational meetings of directors or stockholders, and - Fees paid the state of incorporation, - Other legal costs incurred in connection with state corporate charter renewals of limited duration. So, what aren’t organizational expenses? The following expenses would be capitalizable (non-deductible) and not qualified organizational expenses: - Commissions and other expenses incurred with the issuance or sale of stock or other securities, - Expenses incurred with the transfer of assets to a corporation,

Answer 5

The Accumulated Adjustments Account

Answer 6

Remainders, after tax-free distribution out of Accumulated Adjustment Account, can be taxed at the dividend rate up to the Earnings and Profits of the partnership. ALL REMAINING IS TAXABLE GAIN, once you subtract the basis, which must come out in computing any gain.

Answer 7

- Fed. Income Tax - Non-deductible penalties and fines - Office Life Insurance Premiums (where corp. is beneficiary) - Producing tax-exempt income - Non-deductible Charitable contribution portion

Answer 8

- Refunds of Fed. Income Tax - Tax-exempt income - NOL Deductions - Life ins. proceeds (not premiums paid) where CORP is beneficiary - DRD goes back in - Carried-over Capital Losses - Carried-over Charitable Conts. **Earnings and profits is to Income Taxation, what a Retained Earnings calculation is to GAAP**

Answer 9

Any amount up to the extent of their BASIS in the stock.

Answer 10

Depreciation. Depreciation expense is computed at the corporate level and not passed through separately to the shareholder. (Section 179 deduction is not considered depreciation expense for this purpose.)

Answer 11

individuals that will honor the public trust.

Answer 12

100 sh. at $100/sh. becomes 200 sh. at $50/sh. Stock splits do not CREATE NEW EQUITY. they simply split the equity already in place.

Answer 13

- Securities of a bank - commercial paper - government securities - securities of nonprofit organizations - securities of savings and loan associations - securities of common carriers or contract carriers - insurance, annuity, and endowment policies.

Answer 14

It is taxable to the beneficiary at the same gross profit percentage used by the decedent.

Answer 15

I. Expenses of administering and settling the estate | II. State inheritance or estate tax

Answer 16

Up INTO spousal year of death! EG -- spouse dies 10/1/13. In 2013 you file married filing jointly.

Answer 17

5% Also, the option price needs to be less than the LESSER of 85% of the stock price when granted, or exercised.

Answer 18

Nope. They receive capital gains treatment.

Answer 19

Multiply Net Self-Employment inc. by .9235 92.35% !! Then, you do Medicare/SS tax, and take half out as an above the line adjustment.

Answer 20

No. Not-for-profit organizations are generally denied net-operating-loss deductions except in calculating any unrelated business income tax.

Answer 21

When the 33-year-old taxpayer withdraws $30,000 from an IRA, a penalty of 10% is imposed (0.10 × $30,000 = $3,000). The $30,000 is added to taxable income and will be taxed not at the effective rate but at the marginal rate of 35% (0.35 × $30,000 = $10,500). The total tax liability as a result of the withdrawal is $13,500 ($3,000 + $10,500).

Answer 22

Sally Markey took the largest Section 179 deduction available in 2014, $500,000. Equipment purchases: $555,000 Section 179 deduction: 500,000 Bonus depreciation deduction: 27,500 (1/2 of 55K) 1st-year depreciaton ($27,500 × .1429): 3,930 Total 1st-year deduction: $531,430

Answer 23

All of the funds are provided by the employer. The employee does not contribute.

Answer 24

* Farming businesses * Qualified personal service corporations * Partnerships and corporations with gross receipts of not more than $5 million

Answer 25

Any commission is deducted from the amnt. of Gross Sale of House. (EG: 650K gross sale, less 35K of commissions. Net sale price is $615K.) Any improvements are added to the basis. (EG house had a $300K basis and $40K of improvements. So basis of house is $340K.)

Answer 26

Always Zero.

Answer 27

require CPE program sponsors to provide program-level content.

Answer 28

Yes. And they come out of any gains seen by a partner in the partnership.

Answer 29

1. When a corporation starts up and does not start in the first month of its adopted tax year 2. When a corporation is dissolved and does not end on the last month of tax year 3. When a corporation changes accounting policies in the middle of a tax year For the short-period return, income must be annualized (if income for 6 months is $50,000, then annualized income is $100,000). Income tax is then calculated on the full-year annualized income. Then, the tax for the annualized income is reduced to the short-period tax by multiplying the tax by the number of months in the short period divided by 12. This method results in a fraction of a full year: 2 months ÷ 12 = 0.1667; 3 months ÷ 12 = 0.25; 4 months ÷ 12 = 0.333; 5 months ÷ 12 = 0.4167; 6 months ÷ 12 = 0.50, etc.

Answer 30

Nowhere. Child support is non-taxable.

Answer 31

The debtor will NOT be released from liability for the balance due, because an assignment for the benefit of creditors does not require the consent of the creditors.

Answer 32

If chosen before 3/15: Jan 1 of that year If chosen after 3/15: Jan 1 of next year.

Answer 33

Both foreseeability and mitigation of damages.

Answer 34

Fraud in the inducement occurs when a contract is formed BASED UPON the FALSE or MISLEADING statements or actions of another party!!

Answer 35

It's the BASIS OF THE BUILDING. Mortgages on the building are a SEPARATE LINE ITEM.

Answer 36

independent of all other business and professional organizations.

Answer 37

Engineering Under the uniform capitalization rules, certain nonmanufacturing costs such as selling, research, product liability, and service department costs are not capitalized (Regulation Section 1.263A-1(e)(3)(iii)). Generally, manufacturing overhead costs such as indirect labor, indirect materials, purchasing costs, and engineering are capitalized.

Answer 38

Death proceeds $200,000 Less basis in policy: Consideration paid for policy - 25,000 Premiums paid - 40,000 Interest disallowed 0 -------- Taxable amount $135,000

Answer 39

Voidable preference means transfer of assets to a secured creditor LESS THAN 90 days before a bankruptcy filing. We know creditor is "secured" if they have filed and thus perfected. The voidable preference means one secured creditor is favored over others. After bankruptcy is filed, the trustee in bankruptcy may prevent this creditor from receiving the assets and instead transfer them to another creditor.

Answer 40

effects of a direct financial interest in the client on the CPA's independence.

Answer 41

Generally, a corporation is a PHC if it meets both of the following requirements. 1. PHC income test. At least 60% of the corporation's adjusted ordinary gross income for the tax year is PHC income. See the instructions for Part II and the Worksheet for Figuring Ordinary Gross Income, Adjusted Ordinary Gross Income, and the PHC Income Test (Worksheet), later. Also, see Specific Instructions below. 2. Stock ownership requirement. At any time during the last half of the tax year, more than 50% in value of the corporation's outstanding stock is directly or indirectly owned by five or fewer individuals. ***For purposes of this requirement, the following organizations are considered individuals: * A qualified pension, profit-sharing, or stock bonus plan described in section 401(a). * A trust described in section 501(c)(17) that provides for the payment of supplemental unemployment compensation under certain conditions. * A private foundation described in section 509(a). * A part of a trust permanently set aside or exclusively used for the purpose described in section 642(c). Exceptions. The term “personal holding company” does not include the following corporations, even if the two requirements above are met. * Tax-exempt corporations. * Banks, domestic building and loan associations, and certain lending or finance companies. * Life insurance and surety companies. * Certain small business investment companies operating under the Small Business Investment Act of 1958. * Corporations under the jurisdiction of the court in a title 11 or similar case. * Foreign corporations. At-risk, passive activities, and earnings stripping rules: A corporation that has an activity subject to the at-risk or passive activity rules or interest expense subject to the earnings stripping rules (or both) may have deductions and losses suspended or limited under these rules. As a result, do not use deductions and losses limited or suspended in any of the PHC computations. Treat any prior year deductions and losses allowed under the at-risk, passive activity, and earnings stripping rules as current year deductions and losses.

Answer 42

Ways and Means committee, House of REPS... then Senate then Joint

Answer 43

State death taxes paid by the estate

Answer 44

Preemptive rights provide protection for current shareholders to maintain their proportionate ownership share when new securities are sold. When a preemptive right exists, if new stock is sold, shareholders have the right to purchase a percentage of the new issue in proportion with their current holdings. Preemptive = Pro-Rata Increases on Share holdings

Answer 45

The spouses have different accounting methods.

Answer 46

The board of directors has a fiduciary relationship to the corporation. To have violated their responsibility by knowingly allowing pollution, restricting dividends because of the fines and penalties, recovering the loss from insurance, then setting aside the money for bonuses to themselves would certainly be an abuse of discretion. They may not be liable financially because of the insurance recovery. They would not be immune to liability recovery if their actions were illegal or a breach of fiduciary duty.

Answer 47

A formal contract or agreement between countries under international law.

Answer 48

The percentage depletion rate for coal mined in the United States is 10%. Some types of mining for clay are allowed a 5% depletion rate. The 15% rate for mining includes gold, silver, copper, and iron ore.

Answer 49

IRC Sections 1245 and 1250 are only applicable if the Section 1231 assets are sold at a gain.

Answer 50

A security, generally, is the evidence of a debt or ownership or related right. Securities can include stock options and warrants in addition to debt (bonds, notes, loans, mortgages) and stock. A security is a share, participation, or other interest in property or in an enterprise of the issuer that: * either is represented by an instrument issued in bearer or registered form or, if not represented by an instrument, is registered in books maintained to record transfers by, or on behalf of, the issuer; * is of a type commonly dealt in on securities exchanges or markets or, when represented by an instrument, is commonly recognized in any area in which it is issued or dealt in as a medium for investment; and * either is one of a class or series or by its terms is divisible into a class or series of shares, participations, interests, or obligations. (Can include Debentures)

Answer 51

Passive loss rules apply to individuals, estates, trusts, personal service corporations, and certain closely held corporations. Limitations on passive activity losses apply to individuals as a result of a flow through from S corporations and partnerships, but do not apply at the S corporation or partnership level.

Answer 52

Tax on accumulated earnings

Answer 53

The taxpayer is required to recalculate the annual profit reported on a contract.

Answer 54

$35,000 ($10K guaranteed + $25K ordinary business income share) Cash distributions from the partnership have no bearing on the income reported by the partner.

Answer 55

Optimizing the taxpayer's after-tax result

Answer 56

20% and $40,000.

Answer 57

Calculate your Lifetime Learning Credit and compare it to your American Opportunity Credit. You can claim the Lifetime Learning Credit on all qualifying expenses up to $2,000 for all years of postsecondary education, including graduate school. However, the credit is per return, not per student.

Answer 58

Anytime up until the offeree ACCEPTS the offer | note - sending via mailbox rule counts as acceptance

Answer 59

Any reasonable class of persons whom the CPA KNOWS will rely on his/her work + anyone CPA is in privity of contract with

Answer 60

Gross Estate Income (excl. anything allocated to corpus, obvs.) minus all Qualifying estate disbursement expense! (EG - admin expenses, charitable contributions, interest made on required monthly payments made on loans to creditors)

Answer 61

Lesser of: 1) Distrib. to beneficiary 2) Total DNI

Answer 62

It must relate to the collection or receipt of taxable income.

Answer 63

Self-employed person's net profit from self-employment

Answer 64

Discretionary expenses reduce the gross estate and include: -unlimited transfers to qualified charitable, scientific, educational, and religious orgs.

Answer 65

Max of $50,000 of ordinary loss... Remainder of 1244 losses shall be capital losses

Answer 66

ONLY to the extent that CASH exceeds the basis!!

Answer 67

FMV on date of death

Answer 68

50% of s/h plus one share.

Answer 69

* If the amount of unpaid tax is $1,000 or less * If there was no tax liability on the prior-year tax return and the return was for a full year * If at least 90% of the current-year tax is paid * If at least 100% of the tax liability on the prior-year tax return is paid (if AGI is over $150,000—110% of the prior-year tax) * Waiver for various circumstances such as retirement or disability In this case, $16,000 was paid in during the year through withholding. This is more than 90% of the tax liability of $16,500, so none of the payment is subject to the penalty for underpayment of estimated taxes. Alternatively, the amount of tax underpaid is less than $1,000 so no penalty is due.

Answer 70

the plan benefits 70% of all employees.

Answer 71

Individuals may generally avoid the penalty for failure to pay estimated tax for 2015 by: * paying at least 90% of the tax shown on the current year's return, * paying 100% of the tax shown on the prior year's return (for individuals with AGIs of less than $150,000 in the previous year), or * paying installments on a current basis under an annualized income installment method. An individual may not use the 100%-of-prior-year's-tax safe harbor if the prior year was not a 12-month period, or if the individual did not file a return for the preceding taxable year.

Answer 72

A simple trust is a trust in which all net income must be distributed on an annual basis. A trust in which all income does not have to be distrusted on an annual basis is a complex trust. An irrevocable trust established by a donor to provide an income stream to the income beneficiary, (which the public charity or private foundation receives the remainder value when the trust terminates), is a charitable remainder trust. A trust agreement in which the contributed assets are passed directly to the grantor's grandchildren, not the grantor's children, is a generation-skipping trust. A spendthrift trust is created for a beneficiary that is wasteful with money. The trust prevents the beneficiary from selling the funds or property and BARS SEIZURE from creditors of the beneficiary.

Answer 73

The third party will probably lack privity even in cases where accountant was negligent or failed to live up to duty of due care. APPLIES TO **NEGLIGENCE**.... NOT FRAUD!! PRIVITY OF CONTRACT IS NOT IMPORTANT UNDER FRAUD!! ALL PARTIES AFFECTED ARE LIKELY TO BE ABLE TO CLAIM DAMAGES AND SEEK RECOURSE!!!!! However, Ultramares will not extend privity to Gross Negligence. For this,

Answer 74

Inactive partners

Answer 75

Owning and operating a small manufacturing plant in State Y

Answer 76

Only publicly held C corporations: For purposes of the regular income tax and the AMT, the deduction for compensation paid or accrued with respect to a covered employee of a publicly held corporation is limited to no more than $1 million per year. The “executive pay over $1 million cap” does not apply to compensation paid or accrued to covered employees of all C or S corporations.

Answer 77

The securities cannot be the subject of an immediate unregistered reoffering to the public: Rule 506 of Regulation D permits the issuance of unregistered securities by private placement. However, the securities issued under this regulation are considered “restricted,” meaning that they are for personal investment only and generally cannot be resold to the public without registration.

Answer 78

Form 8832 is the election form filed with the IRS by an unincorporated business entity to elect to be treated as a corporation for federal income tax purposes.

Answer 79

To qualify for either the employment credit or the increased Section 179 deduction, a business must be located in the zone and engaged in an active trade or business within the zone and at least 35% of its employees must live in the zone. Certain businesses are not eligible, including golf courses, country clubs, massage parlors, hot tub facilities, suntan facilities, racetrack, gambling, liquor stores, and farms with owned or leased assets over $25,000.

Answer 80

Working papers are not transferable to a purchaser of a CPA practice unless the client consents.

Answer 81

Deductible taxes (such as personal property tax) that are not directly connected with a trade or business (or with property held for the production of rents and royalties) may be deducted in full as an itemized deduction. Payment for registration and licensing of a car may be deductible as a personal property tax, ONLY if it is imposed annually and assessed in proportion to the value of the car.

Answer 82

Fraternal society not operating under a lodge system

Answer 83

It constitutes a gift of present interest.

Answer 84

An unlimited charitable contribution deduction is allowed for an estate if the contribution is provided for in the will of the decedent, the charity is a qualified charity, and if the contribution is paid in the year of deduction or the year following the deduction. There are no other limits on the charitable contribution deduction of an estate.

Answer 85

If an individual rents a personal residence for a period of time less than 15 days during a tax year, the rents he or she receives are not included in gross income and the associated expenses are not deductible as a rental expense. Thus, since Tom rented the property for only 10 days all year, he will not show any income or expenses from the rental on his tax return.

Answer 86

II. the corporation prevails in a determination allowing a deduction in an open tax year that was taken erroneously in a closed tax year.

Answer 87

Minimum wage, overtime, and number of hours in the workweek

Answer 88

A partner who sells a partnership interest at a gain may be able to report the sale on the installment method. The gain allocated to the recapture income and the substantially appreciated inventory cannot be reported under the installment method.

Answer 89

Under an installment agreement between an individual and the IRS to pay off current-year taxes over an agreed-upon period of time, neither the interest nor the late payment penalty is waived. However, effective for months beginning after December 31, 1999, if the taxpayer is an individual who filed the tax return in a timely manner, including extensions, the 0.5% penalty rate is reduced to 0.25% for any month in which an installment agreement is in effect.

Answer 90

Marital deduction is a type of tax law that allows a person to give assets to his or her spouse with reduced or no tax imposed upon the transfer. Some marital deduction laws even apply to transfers made postmortem. Spouses can transfer property between themselves tax free and ex-spouses can do that according to divorce decree.

Answer 91

A small corporation loses the AMT exemption only if its average annual gross receipts for three consecutive years exceed $7.5 million.

Answer 92

The general rule for valuing gifts or noncash appreciated property is the fair market value at the time of the contribution.

Answer 93

The only way for Duff to be released from its financial obligation to Leo Finance is to have the finance company release it from its obligation.

Answer 94

Last day of the current taxable year.

Answer 95

I.fails to provide necessary documents within the specified time period. II.was convicted of a drug trafficking offense or a violent crime and the victim files a motion to dismiss the petition. III.has income over the average median family income of the state where the petition is filed. IV.fails to pay post-petition child support or alimony payments.

Answer 96

($25,000 × 2/7 × 1.5/12).

Answer 97

No. Only estate things.

Answer 98

may elect not to assume the equipment lease.

Answer 99

Since both of the installments were received after May 5, 2004, and the property sold was held more than 12 months, both installments are taxed at the 15% capital gains rate. Thus, the capital gains tax is $9,000 ($60,000 × 0.15).

Answer 100

Any foreseen or known third party who relied on the report.

Answer 101

ANNUALIZATION METHOD ONLY

Answer 102

a credit that allows donors and decedents to transfer a limited amount of property without being subject to the gift or estate tax.

Answer 103

For the year 2015, the maximum Section 179 expense is $25,000. However, if qualifying purchases exceed $200,000, the maximum must be reduced dollar-for-dollar. Also, if TAXABLE INCOME for the year is lower than 25K, Section 179 deduction cannot exceed taxable income so it can only be equivalent to taxable income at most.

Answer 104

The first income tax return by the due date (including extensions) using that tax year. Merely filing an application for an extension or paying estimated taxes does not allow the taxpayer to adopt a tax year.

Answer 105

NO LOSS RECOGNIZED!!!!

Answer 106

You recognize that 100K of gain, as it is now discharged.

Answer 107

You recognize that 100K of gain, as it is now discharged. THIS ISNT THE SAME AS BANKRUPTCY. It's insolvency.

Answer 108

#1 only. The existence of more than one class of stock would not in and of itself result in the 1934 Act being applicable.

Answer 109

1. LLCs have complete pass-through of tax attributes generated by operations. 2. Every member is allowed to participate in an LLC. 3. Every member of an LLC has liability protection.

Answer 110

The secured party has priority in the collateral over most creditors who acquire a security interest in the same collateral after the filing.

Answer 111

A form of consumption tax A value-added tax is a tax passed on to the consumer and an estimated market value added onto a product or material at each stage of the manufacturing process. Unlike the sales tax, which is collected at the cash register, the VAT is imposed at each stage of the production process.

Answer 112

A CPA may be held liable to clients for: 1) fraud (incl. gross negligence/ reckless disregard) 2) negligence 3) breach of contract. There is no "Strict Liability" for CPAs. Strict liability does not require a finding of fault. Common law has generally required some finding of fault, in application to CPAs.

Answer 113

When there is a gift of present interest.

Answer 114

Capital assets include investment property such as land held as an investment. Capital assets do not include the following: -Property held for resale (inventory) •Real or depreciable property used in a trade or business •Accounts or notes receivable acquired in normal business operations

Answer 115

Not deductible on Form 1040.

Answer 116

You can only include in your income, amounts exceeding the difference between Itemized and Standardized. EG: Tom itemizes deductions of $6400 for the year. Standard Deduction that year was $6200. How much of his $1500 state tax refund should he include in Gross Income? $6400-6200 = $200 includable

Answer 117

Deductible to the extent of ratio of taxable income to total income.

Answer 118

All indorsers would be discharged from liability if the check was certified subsequent to the indorsements. Under the Uniform Commercial Code, “Certification of a check is acceptance. Where a holder procures certification the drawer and all prior indorsers are discharged.”

Answer 119

the lesser of 3% of the excess of adjusted gross income over the applicable amount or 80% of certain itemized deductions. For higher-income taxpayers, the total amount of itemized deductions is reduced by 3% of the amount of the excess of adjusted gross income over the applicable amount of 80% of certain itemized deductions, whichever is lesser. The following are considered high-income taxpayers in 2015: •Single filers with income over $258,250 •Head of household filers with income over $284,050 •Married filing joint filers with income over $309,900 •Married filing separate filers with income over $154,950

Answer 120

A cash-basis taxpayer should report income for the year in which it is either actually or constructively received. Income is constructively received by a taxpayer in the taxable year during which it is credited to his account, set apart for him, or otherwise made available so that he may draw upon it at any time.

Answer 121

NO Prior agreements | ONLY subsequent agreements

Answer 122

Parties in privity of contract

Answer 123

GOV BONDS. Government bonds sold by an individual investor are capital assets, so the sale would be reported as a capital gain. The equipment sold is presumed to be business equipment subject to depreciation and therefore classified as Section 1231 assets subject to Section 1245 recapture. Inventory is specifically excluded from capital assets. Although real property is often a capital asset, real property that is subdivided and sold by a dealer is considered to be like inventory in the hands of the dealer and therefore excluded from capital assets.

Answer 124

Transfer of property to a controlled corporation When property that is owned by the taxpayer is transferred to his controlled corporation (80% owned immediately following the transfer of property to the corporation), no gain or loss is recognized if the exchange is solely for stock. Because no G/L is recognized, this makes it a like-kind exchange.

Answer 125

Over $1,000 total wages in a quarter.

Answer 126

The audit partner discusses matters of significance with management and provides recommended solutions and ramifications of alternative disclosure and accounting treatments. As per Section 204 of the Sarbanes-Oxley Act (SOX), the accounting firm must report to the audit committee all critical accounting issues and alternative treatments. There is no prohibition from discussing these items with management and/or the full board. In the other answer choices, the audit committee was not involved. Worse, no discussion had occurred with the board or the audit committee.

Answer 127

The $300 Exemption.

Answer 128

No. 1) Secured / perfected creditors 2) SAG-WEG-CTI Creditors 3) General unsecured creditors. Anytime there is a limited amount left on one of these "Levels," there is a pro-rata distribution and no one else gets paid!!!

Answer 129

Sales of $2,000 are reported in gross income, and $2,000 of expenses is reported as a miscellaneous itemized deduction subject to the 2% limitation. YOU CAN ONLY DEDUCT EXPENSES up to the income of the hobby.

Answer 130

The term “surviving spouse” means a taxpayer whose spouse died during either of the two taxable years immediately preceding the current taxable year, and who maintains his or her home where a dependent resides. FULL YEAR home maintenance.. full-year dependent living with them

Answer 131

Job must make installment payments of estimated tax if the company expects ESTIMATED TAX to be $500 or more for 2015.

Answer 132

Total costs incurred to date, to total estimated costs.

Answer 133

Purpose is to: 1) Oversee union elections 2) To determine if an employer’s actions constitute an unfair labor practice (usually discrimination). no vaca pay/sick pay can be exempted from this.

Answer 134

- computational errors, failure to file the return in a timely fashion or just plain erroneous advice - an understatement of liability if the tax preparer KNOWS or Should Know, that the deductions or credits resulting in the understatement have *~*~no~*~* realistic possibility of being sustained on its merits.

Answer 135

1) Amnts owed partners for loans in the partnership 2) Partners' capital account 3) Amounts owed partners for PROFITS

Answer 136

Must recognize ANY gain or loss. When property is repossessed after an installment sale, the taxpayer must figure the gain or loss on the repossession and the basis of the repossessed property.

Answer 137

Long-term capital gains are GENERALLY taxed at 15% for sales after May 5, 2003 Exceptions: - Indivs. in the 39.6% tax brackets taxed at 20% - 2007-2015: when tax rate is either 10% or 15%, your cap gains are taxed 0%

Answer 138

Control group must be 80% in control to have a "Tax-free transaction" upon forming a corporation. If someone donates services, they are excluded from the control group. If this creates a situation where others have donated EG land or property, that Contributor must recognize the realized gain on the transaction (EG.. 10K prop worth 100K is 90K gain recognized.) No one who donates cash ever needs to recognize. In summary.. a person who donates services and receives too large a stake in the corporation is essentially fucking everyone else over.

Answer 139

Co-owners of property, joint ventures, syndicates Merely sharing in expenses does not constitute a partnership. A syndicate is a self-organizing group of individuals, companies, corporations or entities formed to transact some specific business, to pursue or promote a shared interest. In most cases formed groups aim to scale up their profits.

Answer 140

You must allocate the share of any losses first (EG bad debts that needed to be written off because they were uncollected; loss on property sold) And then THOSE losses need to be applied, according to P&L agreement within the partnership (EG losses may need to be split 60/40) THEN, you receive your Capital Contribution, LESS your share of losses. (OR Plus your share of gains!) as cash.

Answer 141

A taxpayer may file a claim for a refund until the later of three years after filing a return or two years after paying the tax, whichever is later. If no return was filed, the claim must be made within two years of payment of the tax.

Answer 142

Good faith and lack of knowledge of the statement's falsity.

Answer 143

When the father loses money. If the father loses money on a sale to a close relative, the loss may not be recognized until a future date when the property is sold to an outside party.

Answer 144

IF basis and FMV of bond instrument are =, all interest income is allocable to "Income" EG, basis of bond = $500K and FMV of bond = $600K.. means 5/6 to interest, and 1/6 back to corpus, because of the Gain on FMV! ALSO, interest allocations are made by multiplying (Basis of Bond * Int %.) Not FMV.

Answer 145

The 2014 IRC Section 179 deduction was $500,000/$2,000,000 with a 50% bonus depreciation. On 1/1/15 the extension for 2014 lapsed and is now at $25,000/$200,000 with 0% bonus depreciation. All reduce DOLLAR FOR DOLLAR over thresh amount (EG, $2mil in 2014, and $200K in 2015). These amounts are currently being debated in Congress.

Answer 146

Expenditures for research and experimentation deductible under Section 174.

Answer 147

Advisory, implementation, and product services

Answer 148

The tax on unrelated business income can be imposed even if the unrelated business activity is intermittent and is carried on once a year.

Answer 149

A vital monitoring and control mechanism to support an Environmental Management System.

Answer 150

Consulting with experts.

Answer 151

$98K - $118K for couples when you are NONEXEMPT due to being covered by a pension plan at WORK.... Phase out to the % extent to which you are in this "Zone" (EG -- total $11K possible contribution deduction is reduced in half, when couple's AGI is at $108K.)

Answer 152

Tax rates for trusts

Answer 153

To establish negligence, a client must show that: * the CPA owed a legal duty, * the CPA breached that duty, * the CPA's action was the proximate cause of the resulting injury to the client, and * the CPA's actions caused the damage or loss. The client does not have to prove reliance on the CPA's advice. **No reliance necessary in Negligence**

Answer 154

- Exemptions come out IN CALCULATING taxable income (EG you will get to taxable income, by taking them first) - Standard deductions come into play when you are playing with taxable income.

Answer 155

- Uniforms worn for charitable activity - Meals/lodging bought in pursuit of charitable activity - Miles/transportation incurred for charitable activity Not value of Services. As you know.

Answer 156

52- or 53-week year.

Answer 157

* No part of the organization's net earnings will inure to the benefit of any private shareholder or individual. * No substantial part of the organization's activities include carrying on propaganda, or otherwise attempting, to influence legislation. * The organization does not participate in, or intervene in any political campaign on behalf of (or in opposition to) any candidate for political office.

Answer 158

- all direct costs. | - SOME indirect costs

Answer 159

A civil fraud penalty can be imposed on a corporation that underpays tax when it maintains false records and reports fictitious transactions to minimize corporate tax liability.

Answer 160

No. But you can for maintenance, repair, and interest charges related to that assessment. EG - tax assessment to build a new traffic light for $250 - no Tax assessment for repair to streetlight $100 - Yes

Answer 161

A holder after a holder in due course has all the rights of the first holder in due course. Hunt has the right to assert Drake’s rights, including his standing as a holder in due course, and also has the right to obtain Drake’s signature.

Answer 162

YEP! EG lets say you itemize mortgage interest, and realize that it is higher than the standard deduction. Then, that is the deduction you take in arriving at taxable income.

Answer 163

Zero Dollars $ There is no standard deduction for a trust or an estate (IRC Section 63(c)(6)(D)). Instead: 1) personal exemption for an estate is $600 2) for a simple trust is $300 3) and for a complex trust is $100,

Answer 164

limiting the card holder's liability for unauthorized use.

Answer 165

Blank, nonrestrictive, and unqualified

Answer 166

To the extent of acquisition indebtedness AKA -- FMV - Basis

Answer 167

An assignment for the benefit of creditors is a transfer by the debtor of all of his assets to a trustee, with the assigned funds to be used to pay off outstanding debts. This does not have the effect of releasing the debtor from the debts.

Answer 168

The total gain on the sale of his partnership is $24,000 ($28,000 cash + $15,000 relief of his share of liabilities less basis of $19,000). Unrealized receivables of $6,000 are treated as ordinary income—the remaining $18,000 is capital gain. unrealized receivables = Ordinary Income.