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REG > Calculations to REMEMBER > Flashcards

Calculations to REMEMBER Flashcards

1
Q

Adjusted Gross Income (AGI)

A

Gross Income - Adjustments

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2
Q

Taxable Income before Qualified Business Income (QBI) Deduction

A

AGI - Standard Deduction
or
AGI - Itemized Deductions

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3
Q

Taxable Income

A

Taxable Income before QBI Deduction - QBI Deduction

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4
Q

Tax Due or Tax Refund

A

Federal Income Tax - Tax Credits + Other Taxes - Payments

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5
Q

Individal Income Tax Formula

A

Gross Income
(Adjustments)
__________________
AGI
(Standardized Deductions or Itemized Deductions)
_________________________
Taxable Income before QBI Deduction
(QBI Deduction)
___________________________
Taxable Income

Federal Income Tax
(Tax Credits)
Other Taxes
(Payments)
________________________
Tax Due or Tax Refund

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6
Q

Profit or Loss

A

Gross Business Income
(Business Expenses)

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7
Q

Net Rental Income (Loss)

A

Rental Income
(Rental expenses)
_____________________________
Net rental income (loss)

Rental income includes Gross rental income, Prepaid rental income, Rent cancellation payments, Improvements in lieu of rent

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8
Q

Qualified Business Income
(QBI)

A

QBI x 20%

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9
Q

3-Step Process for Section 199A Qualified Business Income Deduction

QTB

A
  1. Calculate the tenative QBI deduction
  2. Calculate the overall limitation
  3. Choose the lesser of step 1 and step 2
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10
Q

3-Step Process for Section 199A Qualified Business Income Deduction

SSTB

A
  1. Calculate the tenative QBI deduction
  2. Calculate the overall limitation
  3. Choose the lesser of step 1 and step 2
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11
Q

5-Step Process for Section 199A Qualified Business Income Deduction

QTB

A
  1. Calculate the tenative QBI
  2. Calculate and choose the greater of the full W-2 Wage and Property Limitation
    * W-2 Wages x 50%
    * W-2 Wages x 25% + UBIA of Qualified Property Limitations x 2.5%
  3. Choose the lesser of step 1 and step 2
  4. Calculate the overall QBI Limitation
    (Tenative before QBI - Net Capital Gains) x 20%
  5. Choose the lesser of step 3 and step
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12
Q

5-Step Process for Section 199A Qualified Business Income Deduction

SSTB

A

No QBI Deduction

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13
Q

Kiddie Tax Rate Formula

How would you calculate the kiddie tax rate, if a child makes over $2,600? Is the tax rate the child’s marginal rate or parent’s marginal rate?

A

Parent’s Marginal Rate
Unearned Income -$2,600 - $450

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14
Q

Kiddie Tax Rate Formula

How would you calculate the kiddie tax rate, if a child makes between $1,301 and $2,600? Is the tax rate the child’s marginal rate or parent’s marginal rate?

A

Child’s rate
Unearned Income - $2,600

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15
Q

Kiddie Tax Rate Formula

How would you calculate the standard deduction for the kiddie tax rule if the child had earned income and unearned income?

A

The greater of $1,300
or
Earned income + $450

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16
Q

Business Income/Loss

Schedule C (Gross Income)

A

Gross Business Income - Business Expenses

17
Q

Net Earnings from Self-Employment

A

Earning x 92.35%

18
Q

Self-Employment Taxes

A

Earning x 92.35% x 15.3%

19
Q

Deductible Medical Expenses

A

Qualified Medical Expenses
(Insurance Reimbursement)
____________________________________________
Qualified Medical Expenses “Paid”
(7.5% of AGI)
____________________________________________
Deductible Medical Expenses

20
Q

Deductible Casualty Loss

A

The Lesser of cost/adjusted basis or decline in FMV
(Insurance Recovery)
____________________________________________
Taxpayer Loss
($100)
____________________________________________
Eligible Loss
(10% of AGI)
____________________________________________
Deductible Casualty Loss

21
Q

Taxable Portion for a Fixed Period Annuity Payments

A

(1 - Original Investment / Expected Value) x Monthly Payments

22
Q

If a taxpayer’s residence is not used for rental purposes, what is the primary allowable deduction?

A

Mortgage Interest including property taxes

23
Q

Gifted Property

Donee’s Gain/Loss

A

Sales Price - Basis

24
Q

Property Converted from Personal to Business

Adjusted Basis

A

Original Basis - Depreciation

25
Q

Wash Sales

Basis of the Repurchase Stock or Security

A

Purchase Price + Disallowed Loss on Wash Sale

26
Q

Ending Basis in S Corporation Stock

A

Initial Stock Basis
(+) Additional Contributions
(+) Income items
(-) Distributions to shareholders
(-) Nondeductible expenses
(-) Loss/deduction items

27
Q

Apportionment factor to arriving at taxable income in home state

A

Total Business Income x Percent
OR
Total Business Income x Percentage / 3

REG (14 decks)

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