Miscellaneous

Question 1

Form 114 items

Answer 1

Foreign financial assets
Held in a foreign financial account
held at a foreign financial institution

Question 2

Personal use gain/loss

Answer 2

Gain on sale of Personal use items ARE taxable
LOSS on sale of personal items is NOT deductible

Question 3

Consequential damages

Answer 3

Arise not directly or immediately from an act of another party but in consequence of such an act.
Renter breaks contract with landlord, landlord has to add new renter but gets a lower rate

Question 4

Schedule M-3

Question 5

Separately stated items S Corp

Answer 5

Dividends received
Capital gains
Distributions to shareholders

Question 6

What establishes rules and procedures for a LLC

Answer 6

Operating Agreement
NOT shareholder agreement
NOT articles of incorporation
NOT bylaws

Question 7

Schedule 3 - what is on it?

Answer 7

Capital loss carry forward is 1 item

Question 8

What is indemnification between principal and agent

Answer 8

Indemnification refers to the duty of the principal to compensate the agent for losses incurred while acting for the principal

Question 9

Can you deduct expenses from hobby activity

Answer 9

You cannot deduct any losses, you can only deduct expenses against any income

Question 10

Rule 506 Offering

Answer 10

Rule 506 offerings can raise an unlimited dollar amount. They are restricted to only accredited investors, and up to 35 “sophisticated” investors. The company needs to notify the SEC of the offering within 15 days after the first sale of the offering.

Question 11

Recognized Fiduciary duties

Question 12

Amortization timing

Answer 12

Amortization uses mid month convention

Question 13

Does the Foreign Corrupt Practices Act have any exceptions for any payments?

Answer 13

The Foreign Corrupt Practices Act does allow for a narrow exception for “facilitation payments” made to expedite or secure the performance of routine governmental actions, but the scope of this exception is quite limited and risky, as what may be considered “routine” is not clearly defined.

Question 14

Contributed Property from Personal to a corporation - basis

Answer 14

the corporation takes over the holding period that the shareholder had in the transferred property, so in this case the new corporation would take over the 2 year holding period Tyler had in the property.

Question 15

What Type of Partnership(s) have at least one partner with unlimited liability

Answer 15

General Partnership - ALL partners
Limited Partnership - requires 1 general partner with unlimited liability