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Reg 2015 > Property > Flashcards

Property Flashcards

1
Q

Gift basis

A

Gain - use DB
Loss - use the lesser of DB or FMV at time of dist

DB HOLDING

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2
Q

Business gift basis

A

Whichever is lower - DB or FMV

Unless related party

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3
Q

Donor basis with gift tax

A

Gift tax paid x (FMV-DB)/(FMV-14,000)

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4
Q

Uniform capitalization rules

A

All direct and indirect costs are capitalized - unless

RETAIL, passed 3 yrs

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5
Q

Depreciation $basis of a gift

A

Transferred basis less gift tax

Versus adjusted basis:
Includes assessments legal fees to defend title

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6
Q

Stock basis time

A

Old date

Stock splits - Old basis/new number of shares

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7
Q

MACRS recovery periods

A 
3- tools
5- cars,computers, office machinery
7- office furniture, other machinery 
10 - boats, food and tobacco plants
15 - data communication plants, phone sewage billboards
20 - utilities city sewers
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8
Q

Section 179

A

Recapture 1245
Acquired unrelated party
25,000 on 200,000
2014 - use 500 on 2mil and add bonus depletion

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9
Q

ADS % and requirement

A

5-cars
10- personal property
15- agriculture
20- real estate

Required for listed, tax exempt,outside us, disc-imports

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10
Q

Bonus depletion - first year

A 
\+ sect179
50% of Agi
Purchased - 2007-2014 
Used for 50% - 2014-2015
Used for 100% - 9/2010-2011
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11
Q

Capital assets

A

For investment

Not business related

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12
Q

Dividends and basis

A

Div do not decrease basis

Excess of earnings = capital gain

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13
Q

LT CAP BASKETS

A 
0 - 15% tax bracket 37k
15% - 33% tax bracket 411k
20% - 39.6% tax bracket
25% - 25% on unrecaptured 1250 gains
28% - sale of collectibles & 1202 stock
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14
Q

Stock 1244

A

Small business 1st owner on worthless - NOL PURPOSES
50,000 per tax payer
Cap

If gain = 50% recognized

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15
Q

Market discount bonds

A

Market discount x (# days held/ # days on bond)

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16
Q

Related party’s

A

Relative - not aunt uncle cousin or in laws

Use disallowed loss - not holding period

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17
Q

Installment sales

A

One payment - sale deferral, residential timeshare, def tax and prop used in farming
NOT INVETNORY, dealer dispositions, sales with escrows

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18
Q

5yr uncollected loan - unrelated

A

ST CLOSS- no business bad debt

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19
Q

Stock repurchase w/in 30 days

A

The disallowed loss - is added to the stock basis!

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20
Q

Property basis

A

Price and costs to acquire

NOT REBATES

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21
Q

Installment sales - realized gain

A

Gross profits x (payments recvd current yr / total contract price)

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22
Q

Installment sales - recognized gain

A

Gross profit ratio x payments recvd

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23
Q

Installment sales - gross profit ratio

A

Gross profit / contract price

Gross profit = sales price - expenses - adjusted basis

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24
Q

Installment sales repossession

A

Recognize the lesser of :
Cash + other FMV in excess of gain already rec
Or gross profit in installments less repossession costs

Interest on def tax obligations : nondealer ar > 5 mil from IS DURING YR OF > 150k

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25
Q

Sec 1031 like kind exchanges

A

Gain recognized: the LESSER
GAIN REALIZED OR BOOT RECVD
Realized gain = total value received - total value given
Boot = other property + liability given up
New basis = old basis + recognized gain + boot received - loss

Net the mortgage = net boot paid IGNIRE IT FOR REALIZED GAIN
DO NOT SUBTRACT BOOT PAID AMT FROM MORTGAGE
IT AFFECTS THE NEW BASIS - not the gain realized

New basis : old basis + boot paid (mortgage assumed) + cash + unlike property - gain recognized - boot received

26
Q

Back taxes on property for purchase

A

Add to basis

27
Q

Inheritance

A

LT cap gain
FMV at time of death or 6 mo later
Sell between for current FMV

28
Q

Like kind exchanges do not include…and can only be recognized with…

A

Us -

No inventory

29
Q

Involuntary conversions

A

No gain if complete conversion
Recognized gain = LESSER
Realized gain or $ not reinvested
Basis = amt reinvested - deferred gain(realized gain-not reinvested)

30
Q

Wash sale

A

Unalloyed loss + basis of new stock purchase and old holding period

31
Q

Related party

A 
Siblings, spouse, children, parents, SH > 50%
No loss
Recognize gain!!!,!
Disallowed loss - forwarded 
Holding period - new
32
Q

1231 property - casualty loss on personal property of co is investment property

A

St = ordinary income
1231 = real or personal business property held > 1 yr
Casualty loss = net loss = ordinary loss
If gain = combine with all 1231 gains

If 1231 losses are > gains = Ordinary loss
If gain = LT capital gain

33
Q

1245 depreciation recapture

A

1245 - depreciable personal property

Gain to extent of depreciation = ordinary income
Lesser of : ALL DEPRECIATION or REALIZED GAIN

Gains > depreciation = LT gain

No 1245 LOSSES

34
Q

1250 real property

A

€land, leases or buildings - Gains = ordinary income

SL €11250

Remainder is 1231 gain

35
Q

Gifts exclusions:
Gift requirement
estate tax exclusion
Persons estate

A
  1. Exclude all direct payments to a charity, hospital, university
  2. If: present (full control, now) - exclude 14k person
    Must file if > 14k or is taxable
    Estate tax exclusion = 5.43mil
    Persons estate = life ins proceeds + 1/2 marital prop
36
Q

Net estate tax

A

Gross estate tax + UNIFIED CREDIT (5.43m)

37
Q

Gst and estate tax

A

2015 both exemptions are the same

5.43 mil with 40% tax on overage

38
Q

Like kind w mortgages

A 
FMV new
Mort old
Cash rec
LESS
Basis old
Mort new
Cash giv
39
Q

Parking garage

Store business prop

A

Sect 1231 and land = 1231

Stores do not include land

40
Q 
Asset classification :
Capital
Sec 1231
Other
NA
A

Capital : personal residence, stocks,
Sect 1231: parking lot, building, acquired goodwill
Other : inventory, furniture
NA : treasury stock

41
Q

Estate executioner

A

Files final account of admin to the state

42
Q

Fed estate tax credit may be reduced by

A

Foreign death taxes and tax on prior transfers

43
Q

Estate: joint tenants and right of survivorship belongs to

Revocable

A

Does not split value with other than wife

Revocable trusts are included inestate

State death taxes paid by the estate are an allowed deduction

44
Q

Funeral expenses

A

Deductible by estate only

45
Q

Gift of interest

A

Is a present value

46
Q

Unified credit

A

Includes all other tax considerations
Not an a and b
, just an a

Both lifetime and gift taxes are taxed on a cumulative basis

47
Q

Federal estate tax return due

A

9 mo

48
Q

Couple give two gifts - one for 17 k another for 20k what is taxable

A

WHusband and wife give gifts - each gift if each is split has an exlusion of $28k

49
Q

Section 267

A

The buyer cannot deduct expense until seller reports income

Cash seller - accrual buyer

50
Q

Corp ST LT Treatment

A

Net LTL is added to net STL

Cap losses 3k 3b5f

51
Q

Mineral assets sold in place - what kind of assets

A

Capital assets

52
Q

Compare Apt building & unimproved land

A

Like kind exchange

No capital interest

53
Q

Exclusion for the two year residence gain exclusion

A

Prorate the benefit and apply to the gain

IF DUE TO EMPLOYMENT HEALTH OR UNFORSEEN CIRC

54
Q

Amort 15 yr

A

Sec 197 intangibles

55
Q

If you Elected to amortize the bond premium that yield taxable interest

A

Bond basis is reduced

56
Q

MACRS 7 yr property - 1st yr deduction

A

14.29%

57
Q

Depreciation order

A

Sect 179, reduce bal and do a MACRS

58
Q

MACRS % calc

A 
SL = 20% = 1/5
MACRS = 2/5
Mid qtr = 1.5/12, 4.5/12,
=
MACRS =40% x 5yrsx100%= 20% which leaves 80%
Yr 2= 40%x(80%) = 32% which leaves 48%
Yr 3= 40%x(48%) = 19.2%
Yr 4= 40%x(19.2%) = 11.52%
59
Q

Depreciation conventions

A

Mid yr
Mid qtr - if use, then ALL USE
Mid mo

60
Q

Mineral / gas plant property % depletion

A

15%

61
Q

Covenant not to compete amortization

A

15% sec 197 - gold silver copper

62
Q

Clay mining depletion

A

5 or 7.5%

Reg 2015 (6 decks)

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