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Pre 2018 Suspended Losses


Corduroy Frog

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It's because of the TCJA.   The linked article isn't dated, but I believe its contents are still relevant and highlights the reasons for separate tracking for both corporate and noncorporate taxpayers. Someone else may be able to correct anything that is amiss in its contents, or as someone else recently posted in another topic, you'll have to do your own research from here.

https://www.bakertilly.com/insights/untangling-tax-reform-business-losses-and-nols-for-corporate-and-noncorpora

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On 11/22/2021 at 9:36 PM, Sara EA said:

underline all the NOs and NOTs and count them backwards

Yes, I remember doing that when studying for the SEE, and when taking the *&^ tests, too.  Passed all four sections first try, too.  (Down to 3 sections now; could make snarky comments about tax preparers these days having it easy - but I won't because the IRS is crazier now than it was then.)

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On 11/27/2021 at 5:31 PM, Catherine said:

Yes, I remember doing that when studying for the SEE, and when taking the *&^ tests, too.  Passed all four sections first try, too.  (Down to 3 sections now; could make snarky comments about tax preparers these days having it easy - but I won't because the IRS is crazier now than it was then.)

Catherine, I am studying for the EA using Gleim. Yes, it is down to three parts but, Part 2 the business, estates, trusts; etc is the big one that I believe is two of the previous areas combined. I've passed Part 1 and 3 and plan on passing Part 2 before Jan 15th. I know all about the triple negatives. Canidates may seem to have it easier but I don't think so. What bothers me is the folks who are passing the tests and have never prepared a tax return. Wish me luck on the last exam.

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I wish you success, not luck!  Back in Catherine and my days, the exam was four parts over two days (8 to 4:30).  The third part was corps, which has now been rolled into the business/entities part.  That change puts all the worst cougars in one cage.  Everyone thought individuals would be a breeze, but that was not at all the case. I too passed all four parts on the first try, but my corp score was barely passing.  Back in those days, you got to take your exam home with you because everyone got the same one at the same time.  You could contest answers graded wrong, and the professional associations dug in and did just that.  After the corrections (two answers correct, all answers correct), my corp score went into the high 80%s.  Can anyone contest answers anymore?  A disadvantage we had is that passing scores were curved, like the CPA exam, so if a bunch of geniuses happened to take the test when you did you might not pass with the same score you earned at a different sitting.

Do your best, answer every question even if it's a wild guess, and do NOT go back and change any answers.  Time again, that practice has proven to be fatal.

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The two day/four part test was offered only once/year. Then you waited to receive your grade. I took it in a year that a hurricane hit FL and the eastern seaboard right before the test date, so we could NOT take anything out of the testing room and had to wait until the hurricane areas could set up testing before all the tests could be scored and the scores curved. When they did finally publish the answers, weeks had gone by so it was hard to remember/guess what MY answers were. If you didn't pass all four parts, you had to wait a year.

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I thought one of the worst things about it when I took the exam was that you had no access to a calculator.  I was used to working on scratch paper so that was only so bad, but it did slow down the process and cause me to stress about finishing in time.  On the other hand,, there were a few questions that were identical to previous years' tests that I recognized and could answer without any work at all. 

My understanding at the time was that the curve existed so they could control the number of EA's admitted to practice in any given year.  Basically, they decided how many new EA's they wanted, and then set the passing score accordingly. 🤷‍♂️ And I think at that time you had to pass two of the four parts, and get within so many points of passing the other parts to avoid having to take it all over again.  And testing centers were at IRS offices, proctored by IRS employees. 

I don't know which way to take the exam is harder - just that it is different now.  Here's to your success, Terry D!

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The CPA exam was similarly graded on a curved scale, and the grading of the essay questions was totally subjective as well.  No contesting the grade, and yes, I do remember that it was further subjected to a "curve" or something at the state level where the state board of accountancy would decide how many applicants would pass. If they wanted to, they could adjust the grade by a point or two depending on how many new CPAs they wanted to let in or keep out!  This was in the early to mid 1980s.

At one time, my state did have a problem with some regulation that allowed a huge number of foreign students to take the exam under our rules, but that loophole has been closed for a while now.

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Lion, you and I must have taken the EA exam together!  It was in 2004 at a hotel in Bristol, near ESPN and its huge satellite dishes.  I was kind of glad we couldn't take our exams home.  When I got back I opened a beer and went out on the deck to enjoy the relief and marvel at the hurricane-threatened sky.  If I had had the exam questions, I would have been in the house frantically looking up things I wasn't so sure of.  And Gail, not only were no calculators allowed, but no phones (lest you call a friend on the West coast where they started the same exam three hours later and divulge some of the questions).  The proctors announced they would follow you to the restroom to assure no phone calls were made, but they never did that.  With today's phones, you could probably send pics of the entire exam from your watch.  Are calculators and/or phones allowed now?  Does everyone get the same exam?

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Sara, we did !! I stayed two nights to not have to drive back and forth in rush hour traffic. Nothing was allowed in the exam room. They gave us pencils and scratch paper. Doing long division by hand. We had to turn everything back in lest we tell our friends in FL who weren't taking the test that day due to a hurricane (Ivan?). Some people who took the HRB EA prep course together went out to dinner after the first day. Our brains were fried, and we still had another whole day to go. A friend who was a teetotaler even had a drink with dinner. When I went home after it was all over, I had a drink alone before my husband got home from work; and I never drink alone. I said I better pass, because I was never going through that ever again! The test was 22-23 September 2004, but my EA certificate is dated 11 May 2005. I spent six months of my live studying for that test and eight months waiting for my EA certificate.

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The exams are administered in a Prometric test center. Nothing is permitted in the exam room. A locker is assigned and everything you have must be placed in the locker. Prior to entering the test room, they use a wand to check for any items just like the airport TSA but just a bit worse. Rolling up your shirt sleeves, pulling up pant legs and if you wear glasses, you must take them off and turn them over and over to allow them to inspect for cameras. The test center admin will give you scratch paper, a $1.00 Dollar General calculator and a pencil. Results are given immediately, either pass or fail. All tests passing scores for all tests range between 105-130. Areas of proficiency are given if you pass and that's it. No idea of what you missed nor what your score is just "passed" which is really all you care about. If you fail, then you are given a score and again, areas you need to work on. Being 100% honest, the test(s) that I have taken have not seemed to be too bad. 24+ plus years prep experience helps. Corps are going to be the tough area for me. 

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Interesting that you can no longer contest answers.  Every exam cycle some "correct" answers were contested by individuals and the professional associations, and a few were always changed and scores adjusted.  (Some actually had two correct answers; sometimes the law had changed but the question hadn't been updated so all responses were considered correct.)  Unless the test writers suddenly got perfect, chances are that some of the "correct" answers on the tests taken now aren't the only ones or are wrong, but you have no way to argue. 

Lion, I too took the HRB EA prep course, taught by Maureen Murray in North Haven.  I too did nothing but study for months and HAD to pass all four parts because I was never going to go through that again.  And Terry, I had not even had a course in corps when I took the SEE, but I studied everything I could and passed on the first try. It's possible, so go for it!

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On 11/29/2021 at 8:20 PM, Terry D said:

Canidates may seem to have it easier but I don't think so.

I never said that! I said I could make snarky comments about it - but snark is not accusation.

In some ways, it's all harder now.  Yes, you take the exams one at a time, and not only once a year.  But I know a couple of EA-wannabes yet to take all the exams because they can re-schedule. "I'm not ready" becomes either a respite, or an excuse to keep re-delaying in perpetuity.  Having that once a year hard deadline lit a fire under your feet.  Yes, I agree completely - the Part 3 entities and corporations is not a fun combo.  

When I took the exams (2003 - the year before the hurricane event that Lion and Sara dealt with) it wasn't held in an IRS office.  There was a large conference center in Boston, above the Prudential Center shopping mall, rented out by the IRS - and staffed by IRS and MaSEA proctors. We got lockers for all our stuff, and could only bring in eyeglasses.  There were (fortunately!) bathrooms *inside* the cordoned-off zone. No calculators. Pencils were on the tables, and scratch paper. Seating was in zig-zags on long tables, so you could not see what others did.  No pencils or paper left the area, even to go potty - they checked.  I remember getting a nasty headache after the first day from concentrating so hard; wandered the mall for an hour or more letting that fade before driving home.  Bought myself a cute sweater at a store - that I still have and wear!  It's held up really well.

We got our exams, and scores, back by mail months later.  I think I still have them tucked away somewhere.  Passed all with good margins but I think it was the S-corps and partnerships section that had the lowest score.  AAA and OAA, and inside/outside basis, are tricky enough without adding in the conditional triple negatives!

I wish you the best of success!  We need more EAs.

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Yeah, a huge ballroom in a hotel with identical tables and chairs and social distancing and proctors and felt very 1984 - George Orwell not the actual year. No one talked OUTSIDE the room, either. Fear? We didn't talk until after driving to a distant restaurant for dinner after the first day was over. And not at all when we ended the second day, total zombies by then. I should've wondered around a mall/humans like Catherine to slowly return to humanity. But I drove 1.5 hours home (actually, more like 2.5 in rush hour) to an empty house.

Just do it, Terry! Get that last part done. If you can parse your way through IRS Pubs, you can parse your way through the poorly-written questions. Read the question/the last sentence first so you know in what context you'll use all the preceding information, even which pieces aren't needed. Eliminate any obvious wrong answers. Basis, basis, basis. You can do it, Terry!

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