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REG CPA Exam Study Guide Solutions

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REG CPA Exam Study Guide Solutions Qualified Higher Education Expense - ANSWER-up to $4,000 of tuition and fees for enrollment may be deducted by taxpayers with AGI up to $65,000 1040 Adjustments - ANSWER-I EMBRACED Education, Health, and Farm Interest on student loan Employment tax Business ...

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  • November 11, 2024
  • 21
  • 2024/2025
  • Exam (elaborations)
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OliviaWest
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REG CPA Exam Study Guide Solutions


Qualified Higher Education Expense - ANSWER✔✔-up to $4,000 of tuition and fees for enrollment may

be deducted by taxpayers with AGI up to $65,000


1040 Adjustments - ANSWER✔✔-I EMBRACED Education, Health, and Farm




Interest on student loan


Employment tax


Business expense


Rent/Royalty


Alimony paid


Contributions to retirement


Early withdrawal penalty


Jury duty pay


Education expense


Health savings account


Farm income




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, Copyright © OLIVIAWEST2024/2025 ACADEMIC YEAR. ALL RIGHTS RESERVED


Federal and state income tax refunds - ANSWER✔✔-excluded from a taxpayer's taxable income to the

extent that the refund did not reduce the amount of tax for the earlier year




interest earned is considered taxable


Itemized Deductions - ANSWER✔✔-COMMITT




Charitable contributions


Other miscellaneous


Miscellaneous expenses - 2%


Medical expenses - 10%


Interest


Taxes


Theft or casualty 10% - $100


When must an individual file a tax return? - ANSWER✔✔-if their income is greater than the sum of their

personal exemption plus their standard deduction


Kiddie tax - ANSWER✔✔-child's unearned income ($2,100) about the thresholds is subject to tax at the

parents higher rate


Social security benefits - ANSWER✔✔-up to 85% of benefits may be taxable




Copyright ©Stuvia International BV 2010-2024 Page 2/21

, Copyright © OLIVIAWEST2024/2025 ACADEMIC YEAR. ALL RIGHTS RESERVED


if less than $25,000 provisional income - the person can exclude all SS income




provisional income exceeding $60,000 - maximum of 85% inclusion


Net operating losses for an individual - ANSWER✔✔-Carryback 2 years carry forward 20 years


student loan interest for higher education - ANSWER✔✔-$2,500 phase out applies


Self employment tax - ANSWER✔✔-50% of tax is deductible on return


100% of medical insurance premiums paid for self an family are deductible


Moving expenses - 1040 - ANSWER✔✔-must work at least 39 weeks (9 months)


direct costs of moving you and stuff


Hobby loss - ANSWER✔✔-if no profit 3 of 5 years - loss is not deductible and it is considered a hobby loss




net income= other income


expenses = sch. A misc. 2%


Alimony paid - ANSWER✔✔-CANNOT




Cash only


Apart when payments mad


Not child support



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