Wrong answer Flashcards

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1
Q

Hobby loss

A

Hobby loss= misc income (if you haven’t pulled a profit 2 of 5 years )

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2
Q

Schedule H

A

Household Employees
(You employ someone to care for your child or disabled sibling )

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3
Q

Alimony vs Settlement

A

Take alimony paid - 37,500= recapture

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4
Q

Low income housing loss calculation

A

Take the amount of loss x marginal tax credit = credit

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5
Q

Reduced SS benefits calculation

A

PIA- [(# of months early/180)xPIA]

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6
Q

Section 197

A

Similar to straight line depreciation
Only for Intangibles (goodwill, etc)

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7
Q

179 Deduction

A

You can expense up to 1,160,000 of qualifying property in year of acquisition
- only 1245 property
- cannot create a loss

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8
Q

What is a Preference Item? (AMT)

A

IPOD

Intangible drilling cost
PRIVATE activity municipal bond
Oil and gas PERCENTAGE depletion
Depreciation (only ACRS/MACRS) NO STRAIGHTLINE

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9
Q

What is an add back item? AMT

A

ISO “bargain element”
Property, state, city, income tax

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10
Q

How to you avoid AMT?

A

Increase Income
Defer paying property, state taxes, deductible medical expenses or charitable gifting
Deferred exercising ISO to a later date or disqualify
Purchase public purpose munis

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11
Q

What is AMT payable?

A

AMT less Taxes Payable

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12
Q

Boot Calculation

A

Boot received = recognized gain
Boot paid adds to basis
Basis carries over

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13
Q

Tax Rate of Collectibles

A

28%

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14
Q

Section 121

A

Sale of Residence
500k of gain is excluded (MFJ)
250k of gain is excluded (single)

Has to be used as primary residence 2 of 5 most recent years unless for divorce

Don’t have to report at all on taxes

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15
Q

Minimum % benefit for non key employees in a top heavy plan

A

2% in DB plans
3% in DC plans

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16
Q

Vesting schedule for top heavy DB plan & all DC plans

A

3 year cliff
2-6 year graded

17
Q

Vesting schedule for non top heavy DB plan

A

5 year cliff
3-7 year graded