CPA Exam REG Mnemonics

REG is tax heavy. And you know what taxes mean? SO MUCH TO REMEMBER. I know you’re studying for REG and you’re thinking, my brain literally can’t remember all of this. Who am I, Alex Mullen, who won the World Memory Championships last year?

If you actually are, good for you. But for the rest of us, we need a little help in the memory world. So, being the nice people that we are, we’ve put together a list of CPA exam REG mnemonics (why is that word so hard to spell?). Some are boring, some are fun, but they will all help you remember.

Qualifying Child Dependency Test

CARES

C) Close relative
A) Age limite
R) Residency and filing requirement
E) Eliminate gross income test
S) Support test changes

Qualifying Relative Dependency Test

SUPORT

S) Support (over 50% test)
U) Under taxable gross income exemption
P) Precludes dependent filing joint return
O) Only citizen of US, Canada, Mexico
R) Relative test
or
T) Taxpayer lives with person for whole year

Gross Income

WIDSABC IPRKUSO – Wishing I Didn’t Steal A Baby Cat. I Previously Raised Kittens Until Someone Owned (I have no idea where this came from but it works)

W) Wages
I) Interest Income
D) Dividends
S) State and Local Refunds
A) Alimony received
B) Business income
C) Capital gains/losses

I) IRA income
P) Pension and annuity
R) Rental income/loss
K) K-1 income/loss
U) Unemployment compensation
S) Social Security benefits
O) Other income

Adjustments to Arrive at AGI

EISTHMOSSIAAD – Every Idiot Should Take His Money Out So She Isn’t An Achieving Dog

E) Educator Expenses
I) IRA
S) Student Loan Interest Expense
T) Tuition and Fee deduction
H) Health Savings Account
M)Moving Expenses
O) One Half Self Employment Tax**
S) Self Employment Health Insurance**
S) Self Employed Retirement**
I) Interest Withdrawal Penalty
A) Alimony Paid
A) Attorney Fees paid in certain discrimination/whistleblower cases
D) Domestic Production Activities

** Not deducted on schedule C

Deductible Interest to Arrive At AGI

HIPPE

H) Home Mortgage
I) Investment
P) Personal
P) Pre-paid
E) Educational Loan

Tax Exempt Interest Income

SBSV… is tax free!

S) State and Local Government Bonds/Obligations
B) Bonds of a US possession
S) Series EE
V) Veterans Administration Insurance

Capital Gains Not Taxable

HIDE It

H) Homeowner exclusion
I) Involuntary exchange (no gain recognized)
D) Divorce property settlement
E) Exchange of like-kind

It) Installment sale

Capital Losses Not Deductible

WRaP

W) Wash sale losses
R) Related party losses

and

P) Personal losses

Itemized Taxes

RIPS

R) Real Estate
I) Income
P) Personal Property
S) Sales

Itemized Deductions

COMMITT

C) Charitable Contributinos
O) Other Misc deductions (Not subject to 2% AGI)
M) Misc deductions (subject to 2%)
M) Medical Expenses
I) Interest Paid
T) Taxes Paid but NO FBI** since they’re not deductible
T) Theft or casualty

**FBI – Nondeductible taxes

F) Federal taxes
B) Business and rental property taxes
I) Inheritance tax

AMTI Adjustment

MS PANIC TIME

M) Miscellaneous deductions NOT allowed
S) Standard deduction

P) Passive activity losses
A) Accelerated depreciation (post 1986 purchase)
N) Net operating loss of individual
I) Installment income of dealer
C) Contracts – percentage vs. completed

T) Tax “deductions”
I) Interest deductions on some home equity loans
M) Medical deductions (limited to excess over 10% AGI)
E) Exemptions – personal

Exclusions to Penalty for Early Withdrawal of IRA

HIM DEaD

H) Homebuyer
I) Insurance-medical
M) Medical expenses
D) Disability
E) Education

and

D) Death

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