CPA Reg 2024
- answer
Refundable Tax Credits - answerChild Tax Credit
Earned Income Credit
Federal Income Tax Withheld
Excess Social Security Withheld
American Opportunity (40% refundable)
Penalty for underpayment of estimated taxes - answerNo penalty if owed amount is less
than $1,000
Child and Dependent Care Credit - answer- Nonrefundable
- Child must be under 13
- Expenses are limited to lowest earned income of either spouse
- Depending on AGI you get ~20% of expenses covered
- maximum is 3,000
Retirement Savings Contribution Credit - answer- Nonrefundable
- Covers up to $2,000 for contributions to Traditional or Roth
Excess Social Security Withheld - answerRefundable if withholdings were made by
more than one employer
Safe Harbor for penalty for underpayment of estimated taxes - answerThe lesser of:
90% of the tax on current year's return
OR
110% of the tax on last year's return (if AGI is >150k, otherwise 100%)
Donee's Basis of Property - answerException kicks in when FMV < NBV
Scenario 1 for Donee's Basis - answerSales Price > NBV
use NBV as basis
Scenario 2 for Donee's Basis - answerSales Price < FMV
use FMV as basis
Scenario 3 for Donee's Basis - answerSales Price is in between FMV and NBV
Sales Price is Basis - no G/L
, Basis for Depreciation of Transferred Property - answerLesser of FMV and original
Basis
Tax Basis for G/L for Transferred Property - answerIf there is a Gain: Basis is adjusted
basis at time of sale
If there is a Loss: Take lesser of Basis and FMV at Conversion, then deduct
depreciation
Inherited Property: LT or ST - answerAlways LT. No matter what
Nonresidential Property - answerDepreciated over 39 years, using mid month
depreciation
Residential Property - answerDepreciated over 27.5 Years, using mid month convention
Mid Month Convention MACRS - answerStraight-line, Half the month of sale and
purchase
MACRS 5 year property includes - answerAutomobiles, light trucks, computers, and
copiers
MACRS 7 year property includes - answerFurniture and fixtures, machinery, and
equipment
Midquarter convention is used when - answerMore than 40% of assets are placed into
service in Q4
Intangible assets are amortized over - answer15 years (180 Months)
Bonus Depreciation Limitation - answerAssets converted from personal - business
cannot use bonus depreciation
Assets received as gift are also not eligible
Inherited Property also not eligible
Casualty Loss for C Corps - answerPartially Destroyed: lesser of:
- NBV of property before loss
- Decline in value after loss
Fully Destroyed:
- NBV of property before loss
Deduct Insurance reimbursement for each
- answer
Refundable Tax Credits - answerChild Tax Credit
Earned Income Credit
Federal Income Tax Withheld
Excess Social Security Withheld
American Opportunity (40% refundable)
Penalty for underpayment of estimated taxes - answerNo penalty if owed amount is less
than $1,000
Child and Dependent Care Credit - answer- Nonrefundable
- Child must be under 13
- Expenses are limited to lowest earned income of either spouse
- Depending on AGI you get ~20% of expenses covered
- maximum is 3,000
Retirement Savings Contribution Credit - answer- Nonrefundable
- Covers up to $2,000 for contributions to Traditional or Roth
Excess Social Security Withheld - answerRefundable if withholdings were made by
more than one employer
Safe Harbor for penalty for underpayment of estimated taxes - answerThe lesser of:
90% of the tax on current year's return
OR
110% of the tax on last year's return (if AGI is >150k, otherwise 100%)
Donee's Basis of Property - answerException kicks in when FMV < NBV
Scenario 1 for Donee's Basis - answerSales Price > NBV
use NBV as basis
Scenario 2 for Donee's Basis - answerSales Price < FMV
use FMV as basis
Scenario 3 for Donee's Basis - answerSales Price is in between FMV and NBV
Sales Price is Basis - no G/L
, Basis for Depreciation of Transferred Property - answerLesser of FMV and original
Basis
Tax Basis for G/L for Transferred Property - answerIf there is a Gain: Basis is adjusted
basis at time of sale
If there is a Loss: Take lesser of Basis and FMV at Conversion, then deduct
depreciation
Inherited Property: LT or ST - answerAlways LT. No matter what
Nonresidential Property - answerDepreciated over 39 years, using mid month
depreciation
Residential Property - answerDepreciated over 27.5 Years, using mid month convention
Mid Month Convention MACRS - answerStraight-line, Half the month of sale and
purchase
MACRS 5 year property includes - answerAutomobiles, light trucks, computers, and
copiers
MACRS 7 year property includes - answerFurniture and fixtures, machinery, and
equipment
Midquarter convention is used when - answerMore than 40% of assets are placed into
service in Q4
Intangible assets are amortized over - answer15 years (180 Months)
Bonus Depreciation Limitation - answerAssets converted from personal - business
cannot use bonus depreciation
Assets received as gift are also not eligible
Inherited Property also not eligible
Casualty Loss for C Corps - answerPartially Destroyed: lesser of:
- NBV of property before loss
- Decline in value after loss
Fully Destroyed:
- NBV of property before loss
Deduct Insurance reimbursement for each
