CFP - Tax Flashcards
Itemized Taxes
RIPS
R) Real Estate
I) Income
P) Personal Property
S) Sales
Exclusions to Penalty for Early Withdrawal of IRA
HIM DEaD
H) Homebuyer I) Insurance-medical M) Medical expenses D) Disability E) Education
and
D) Death
AMTI Adjustment
MS PANIC TIME
M) Miscellaneous deductions NOT allowed
S) Standard deduction
P) Passive activity losses A) Accelerated depreciation (post 1986 purchase) N) Net operating loss of individual I) Installment income of dealer C) Contracts – percentage vs. completed
T) Tax “deductions”
I) Interest deductions on some home equity loans
M) Medical deductions (limited to excess over 10% AGI)
E) Exemptions – personal
Deductible Interest to Arrive At AGI
PIPE H
P) Personal
I) Investment
P) Pre-paid
E) Educational Loan
H) Home Mortgage
Gross Income
WIDSABC IPRKUSO – Wishing I Didn’t Steal A Big Car. I Previously Raced Kars Until Someone Owned-it(I have no idea where this came from but it works)
W) Wages I) Interest Income D) Dividends S) State and Local Refunds A) Alimony received B) Business income C) Capital gains/losses
I) IRA income P) Pension and annuity R) Rental income/loss K) K-1 income/loss U) Unemployment compensation S) Social Security benefits O) Other income
Capital Gains Not Taxable
HIDE It
H) Homeowner exclusion
I) Involuntary exchange (no gain recognized)
D) Divorce property settlement
E) Exchange of like-kind
It) Installment sale
Qualifying Child Dependency Test
CARES
Close relative Age limit Residency and filing requirement Eliminate gross income test Support test changes
Tax Exempt Interest Income
SBSV… is tax free!
S) State and Local Government Bonds/Obligations
B) Bonds of a US possession
S) Series EE
V) Veterans Administration Insurance
Qualifying Relative Dependency Test
SUPORT
S) Support (over 50% test)
U) Under taxable gross income exemption
P) Precludes dependent filing joint return
O) Only citizen of US, Canada, Mexico
R) Relative test
or
T) Taxpayer lives with person for whole year
Itemized Deductions
COMMITT
C) Charitable Contributinos
O) Other Misc deductions (Not subject to 2% AGI)
M) Misc deductions (subject to 2%)
M) Medical Expenses
I) Interest Paid
T) Taxes Paid but NO FBI** since they’re not deductible
T) Theft or casualty
**FBI – Nondeductible taxes
F) Federal taxes
B) Business and rental property taxes
I) Inheritance tax
Capital Losses Not Deductible
WRaP
W) Wash sale losses
R) Related party losses
and
P) Personal losses
Adjustments to Arrive at AGI
SHIT I’M DOPE ASS
S (Student Loan)
H (Health Savings)
I (IRA)
T (tuition)
I (Interest withdrawal penalty)
M Moving Expenses
D Domestic Production
O One half of self employment tax
P pre- Paid atty fees
E Educator Expense
A Alimony Paid
S Self Employment health Ins
S Self Emplyoemnt retirement
Above the Line Deductions
OD CAMEL
Ordinary & necessary business expense
Depreciation of Assets
Capital losses (3K Cap) Alimony Moving expenses Loan Repayment (for certain school) Loan
Exceptions to Gross Income
GILTEE
Gifts Inheritance Life Insurance benefits Tort awards Employee related expenses
