This podcast is made by Ran Chen, who holds an EA license, Insurance and Securities licenses (Series 6, 63, 65), and the CFP® designation. He is passionate about opening access to high-quality exam preparation resources and helping learners prepare more effectively for professional certification exams.

In this episode you will learn:

• That backup withholding is a flat 24% rate applied to specific payments like interest, dividends, and nonemployee compensation.

• How a missing or incorrect Taxpayer Identification Number (TIN) on Form W-9 is the most common trigger for backup withholding.

• The process initiated by an IRS "B-Notice" when a payee's name and TIN on a Form 1099 do not match IRS records.

• That backup withholding can also be required if the IRS notifies a payer that the payee has underreported interest or dividend income.

• How to advise clients to stop backup withholding by providing a correct Form W-9 or resolving underreporting issues directly with the IRS.

For more free exam prep tools, practice questions, and AI-powered explanations, visit https://open-exam-prep.com/ or Youtube Channel: https://www.youtube.com/@Open-exam-prep

This podcast is made by Ran Chen, who holds an EA license, Insurance and Securities licenses (Series 6, 63, 65), and the CFP® designation. He is passionate about opening access to high-quality exam preparation resources and helping learners prepare more effectively for professional certification exams.

In this episode you will learn:

• The general three-year statute of limitations for the IRS to assess additional tax and how filing dates affect it.

• The six-year assessment statute for substantial understatements of gross income, including how to calculate the 25% threshold.

• Situations where no statute of limitations applies, such as failure to file or filing a fraudulent return.

• The distinct ten-year statute of limitations for the IRS to collect tax after an assessment has been made.

• A simple mnemonic '3-6-10-Infinity' to remember the key periods for assessment and collection.

For more free exam prep tools, practice questions, and AI-powered explanations, visit https://open-exam-prep.com/ or Youtube Channel: https://www.youtube.com/@Open-exam-prep

This podcast is made by Ran Chen, who holds an EA license, Insurance and Securities licenses (Series 6, 63, 65), and the CFP® designation. He is passionate about opening access to high-quality exam preparation resources and helping learners prepare more effectively for professional certification exams.

In this episode you will learn:

• Distinguish the three grounds for an OIC: Doubt as to Collectibility, Doubt as to Liability, and Effective Tax Administration (ETA).

• Understand that Reasonable Collection Potential (RCP) is the key metric for Doubt as to Collectibility offers.

• Recognize that Doubt as to Liability focuses on the legitimacy of the tax debt, not the taxpayer's ability to pay.

• Identify that ETA offers apply when collection in full would cause severe economic hardship, even if the taxpayer could technically pay.

• Recall that taxpayers must be fully compliant with all current filing and payment obligations before an OIC will be considered.

For more free exam prep tools, practice questions, and AI-powered explanations, visit https://open-exam-prep.com/ or Youtube Channel: https://www.youtube.com/@Open-exam-prep

This podcast is made by Ran Chen, who holds an EA license, Insurance and Securities licenses (Series 6, 63, 65), and the CFP® designation. He is passionate about opening access to high-quality exam preparation resources and helping learners prepare more effectively for professional certification exams.

In this episode you will learn:

• Taxpayers must be age 70½ or older to make a Qualified Charitable Distribution (QCD).

• A QCD allows a direct, tax-free transfer of up to $105,000 (indexed annually) from an IRA to an eligible charity.

• The amount of the QCD can satisfy all or part of a taxpayer's Required Minimum Distribution (RMD) for the year.

• A key exam trap is understanding that funds must go directly from the IRA to the charity; if the taxpayer receives them first, the distribution is taxable.

• A QCD is excluded from the taxpayer's Adjusted Gross Income (AGI) and cannot also be claimed as an itemized charitable deduction.

For more free exam prep tools, practice questions, and AI-powered explanations, visit https://open-exam-prep.com/ or Youtube Channel: https://www.youtube.com/@Open-exam-prep

This podcast is made by Ran Chen, who holds an EA license, Insurance and Securities licenses (Series 6, 63, 65), and the CFP® designation. He is passionate about opening access to high-quality exam preparation resources and helping learners prepare more effectively for professional certification exams.

In this episode you will learn:

• Qualified HSA distributions for medical expenses are always tax-free and penalty-free.

• Non-qualified distributions are subject to ordinary income tax plus a steep 20% penalty.

• The 20% penalty is waived if the account holder is over age 65, disabled, or deceased, though the distribution is still taxable income.

• All distributions are reported on Form 8889, where the taxpayer must prove expenses were qualified.

• Do not confuse the 20% HSA penalty with the 10% early withdrawal penalty for other retirement accounts like IRAs.

For more free exam prep tools, practice questions, and AI-powered explanations, visit https://open-exam-prep.com/ or Youtube Channel: https://www.youtube.com/@Open-exam-prep

This podcast is made by Ran Chen, who holds an EA license, Insurance and Securities licenses (Series 6, 63, 65), and the CFP® designation. He is passionate about opening access to high-quality exam preparation resources and helping learners prepare more effectively for professional certification exams.

In this episode you will learn:

• How to identify a statutory employee on Form W-2 by looking for a check in Box 13.

• The four specific categories of statutory employees, easily remembered with the "DISH" mnemonic.

• Why statutory employees report their W-2 income on Schedule C, not as regular wages.

• The unique tax withholding rule: FICA taxes are withheld, but federal income tax is not.

• How statutory classification allows for the deduction of business expenses, a key exam concept.

For more free exam prep tools, practice questions, and AI-powered explanations, visit https://open-exam-prep.com/ or Youtube Channel: https://www.youtube.com/@Open-exam-prep

This podcast is made by Ran Chen, who holds an EA license, Insurance and Securities licenses (Series 6, 63, 65), and the CFP® designation. He is passionate about opening access to high-quality exam preparation resources and helping learners prepare more effectively for professional certification exams.

In this episode you will learn:

• How to determine if an S corporation distribution is a tax-free return of capital or a taxable capital gain.

• The critical difference between stock basis and debt basis, and why only stock basis absorbs distributions tax-free.

• The specific year-end basis ordering rule: Income first, then Distributions, then Losses.

• How to apply the four-tier distribution system for S corps with prior C corporation Earnings and Profits (E&P).

• Why shareholder basis is the ultimate limit for deducting S corporation losses passed through on Schedule K-1.

For more free exam prep tools, practice questions, and AI-powered explanations, visit https://open-exam-prep.com/ or Youtube Channel: https://www.youtube.com/@Open-exam-prep

This podcast is made by Ran Chen, who holds an EA license, Insurance and Securities licenses (Series 6, 63, 65), and the CFP® designation. He is passionate about opening access to high-quality exam preparation resources and helping learners prepare more effectively for professional certification exams.

In this episode you will learn:

• The gain on a partnership interest sale is split between ordinary income and capital gain.

• A partner's basis, crucial for the gain calculation, must be adjusted for all K-1 items like income, losses, and distributions.

• Section 751 "hot assets," which are unrealized receivables and inventory, are what trigger ordinary income treatment.

• Any gain remaining after accounting for the hot asset portion is treated as a capital gain.

• Partnerships must file Form 8308 to report the sale of an interest involving hot assets to both the IRS and the partner.

For more free exam prep tools, practice questions, and AI-powered explanations, visit https://open-exam-prep.com/ or Youtube Channel: https://www.youtube.com/@Open-exam-prep

This podcast is made by Ran Chen, who holds an EA license, Insurance and Securities licenses (Series 6, 63, 65), and the CFP® designation. He is passionate about opening access to high-quality exam preparation resources and helping learners prepare more effectively for professional certification exams.

In this episode you will learn:

• How to calculate the excess business loss using the 2025 thresholds of $305,000 for single and $610,000 for joint filers.

• That any disallowed excess business loss is treated as a Net Operating Loss (NOL) carryforward to subsequent tax years.

• The critical order of loss limitations: basis, at-risk, and passive activity rules must be applied before the excess business loss limitation.

• What constitutes a trade or business for this limitation, specifically excluding gains and losses from investment activities.

• The purpose of Form 461, which is used to report and calculate the excess business loss limitation.

For more free exam prep tools, practice questions, and AI-powered explanations, visit https://open-exam-prep.com/ or Youtube Channel: https://www.youtube.com/@Open-exam-prep

This podcast is made by Ran Chen, who holds an EA license, Insurance and Securities licenses (Series 6, 63, 65), and the CFP® designation. He is passionate about opening access to high-quality exam preparation resources and helping learners prepare more effectively for professional certification exams.

In this episode you will learn:

• How to apply the 80% taxable income limitation to Net Operating Loss deductions.

• The modern rule for NOLs is indefinite carryforward with no carryback, except for specific farming losses.

• Why nonbusiness deductions like the standard deduction cannot create or increase an NOL.

• Common exam traps, such as confusing current NOL rules with outdated pre-TCJA or temporary CARES Act provisions.

• The simple mnemonic "Eighty Forward Forever" to remember the core post-2020 NOL rules.

For more free exam prep tools, practice questions, and AI-powered explanations, visit https://open-exam-prep.com/ or Youtube Channel: https://www.youtube.com/@Open-exam-prep