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AICPA REG Exam Syllabus Topics:
| Section | Weight | Objectives |
|---|---|---|
| Topic 1: Ethics, Professional Responsibilities, and Federal Tax Procedures | 10-20% | - Licensing and disciplinary systems - Treasury Department Circular 230 rules - IRS audit, appeals, and collection procedures - Ethics and responsibilities in tax practice - Tax preparer penalties and due diligence |
| Topic 2: Federal Taxation of Individuals | 15-25% | - Adjustments, deductions, and credits - Gross income inclusions and exclusions - Loss limitations and tax computation - Filing status and exemptions - Pass-through entity income reporting |
| Topic 3: Business Law | 10-20% | - Secured transactions (UCC Article 9) - Debtor-creditor relationships and bankruptcy - Contracts and UCC Article 2 - Business structure legal framework - Agency relationships |
| Topic 4: Federal Taxation of Property Transactions | 12-22% | - Recognition of gains and losses - Cost recovery, depreciation, and amortization - Like-kind exchanges and involuntary conversions - Capital vs ordinary asset classification - Basis and holding periods of assets |
| Topic 5: Federal Taxation of Entities | 28-38% | - S Corporations - Tax-exempt organizations - Book-tax differences and distributions - Partnerships and LLCs - C Corporations |
AICPA CPA Regulation Sample Questions:
1. In evaluating the hierarchy of authority in tax law, which of the following carries the greatest authoritative
value for tax planning of transactions?
A) IRS regulations.
B) IRS agents' reports.
C) Tax court decisions.
D) Internal Revenue Code.
2. The uniform capitalization method must be used by:
I. Manufacturers of tangible personal property.
II. Retailers of personal property with $2 million dollars in average annual gross receipts for the 3
preceding years.
A) I only.
B) Both I and II.
C) II only.
D) Neither I nor II.
3. Allen owns 100 shares of Prime Corp., a publicly-traded company, which Allen purchased on January 1,
2 001, for $10,000. On January 1, 2003, Prime declared a 2-for-1 stock split when the fair market value
(FMV) of the stock was $120 per share. Immediately following the split, the FMV of Prime stock was $62
per share. On February 1, 2003, Allen had his broker specifically sell the 100 shares of Prime stock
received in the split when the FMV of the stock was $65 per share. What amount should Allen recognize
as long-term capital gain income on his Form 1040, U.S. Individual Income Tax Return, for 2003?
A) $1,500
B) $2,000
C) $750
D) $300
4. Fred Berk bought a plot of land with a cash payment of $40,000 and a mortgage of $50,000. In addition,
Berk paid $200 for a title insurance policy. Berk's basis in this land is:
A) $90,000
B) $40,000
C) $40,200
D) $90,200
5. Greller owns 100 shares of Arden Corp., a publicly-traded company, which Greller purchased on January
1 , 2001, for $10,000. On January 1, 2003, Arden declared a 2-for-1 stock split when the fair market value
(FMV) of the stock was $120 per share. Immediately following the split, the FMV of Arden stock was $62
per share. On February 1, 2003, Greller had his broker specifically sell the 100 shares of Arden stock
received in the split when the FMV of the stock was $65 per share. What is the basis of the 100 shares of
Arden sold?
A) $6,200
B) $6,500
C) $6,000
D) $5,000
Solutions:
| Question # 1 Answer: D | Question # 2 Answer: A | Question # 3 Answer: A | Question # 4 Answer: D | Question # 5 Answer: D |

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