Taxation and Regulation (REG)

The Regulation (REG) section of the CPA Exam tests a candidate's knowledge of federal taxation, business law, and ethics as they apply to individuals, businesses, and property transactions. It covers key areas such as individual income tax (Form 1040), business entity taxation including partnerships, S corporations, C corporations, and sole proprietorships, as well as property transactions like capital gains, depreciation recapture, and like-kind exchanges. The section also includes federal tax procedures, penalties, and taxpayer rights, along with business law topics such as contracts, agency, bankruptcy, and secured transactions under the Uniform Commercial Code (UCC). A solid understanding of both tax planning strategies and legal frameworks is essential, making REG one of the most detail-heavy and rule-intensive sections of the CPA Exam.