Reg 3

Question 1

Exchange tax for stocks

Answer 1

Nontaxable

Question 2

Express warranty is created when

Answer 2

Statement made by the seller become part of the basis of the bargain

Question 3

Loss from sales and exchange not recognized for tax purposes

Answer 3

1. Husband and wife
2. Sister brother
3. Parent and child
4. grantparents
   4.grandchild
   5 majority shareholder corporation
   6 majority partner and partnership

Question 4

Alimony 2018 o before

Answer 4

Allowable deduction at a individual adjusted gross income

Question 5

Charitable contribution. Personal casualty loss and medical expense

Answer 5

Itemized deduction

Question 6

Implied warranty of merchantability applies when

Answer 6

The seller is a merchant of the product involve

Question 7

Tax build- in-gains is imposed on S corporation

Answer 7

That used to beba C corporation and received asset with built of gain.

The built of gains tax is imposed asset that are disposed of eithin 5 year of the S corp

Question 8

Purchased if flea market

Answer 8

Not deductible

Question 9

Evidence that a corporation is doing businees

Answer 9

Owning and operating small manufacturing plant in state Y

Question 10

Dividend receive deduction

Answer 10

20% interest - 50% deduction
20-80%- 65% deduction
80% > 100% deduction via consolidation

Note: calculate the lower of taxable income and dividend receive

Question 11

Penalty for the un payment of estimated taxes

Answer 11

Can be avoid if:

1. Estimates payments and withholding in total are at least to 100% of prior year tax liability or
2. 90% of the current liability is pais:.

Question 12

Miscellaneous itemized deduction

Answer 12

1. Union due

2. Employee business expenses are no longe deductibke under TCJA

Question 13

Common law fraud the plantifg must proof

Answer 13

Plaintiff do not need to have privity.

1. Material misstatement or omission in the financial statements
2. A loss has been suffered as a result of the above
3. Information was relied upon by the plaintiff
4. Error ir scienter

Question 14

To succeed in a common law fraud action

Answer 14

Must prove judtified in relying on the financial statement

Question 15

Actions at law by partner

Answer 15

Not necesarry need to be a complex accounting

Question 16

Alimony 2019

Answer 16

Non included in gross income and is not deductible for the spouse pying the alimony

Question 17

Child support

Answer 17

Not included in gross income

Question 18

Cash for property settle

Answer 18

Not included in gross income

Question 19

Basis of inherited stock

Answer 19

Equal FMV as of the date of death unless the alternative valuation date is elected by executor of the estate.

Question 20

Account method for tax purposes by a new c corp

Answer 20

Is elected on the first tax return

Question 21

No discretionary ítems

Answer 21

Can be deducted from the gross estate and includes (attorney fees + burial lot + states taxes + credit card debt)

Question 22

Partnership basis

Answer 22

Adjudted basis of property contributed + in share of partnership debts - partner debt

Question 23

Subpart F income

Answer 23

Included in income that does not hace connection to the cojntry origin

Question 24

Home mortgages

Answer 24

La itemized deduction

Question 25

Insurance and personal expense

Answer 25

Not deductible

Question 26

Property acquiered from a decedent

Answer 26

Is considered automatically to have a long-term holding period