CPA REG Study Guide: Blueprint, Topics and a Study Plan

REG has the highest pass rate of the three Core sections, at 66.78% cumulatively across the first half of 2026, against 48.65% for AUD and 42.95% for FAR. That is a real gap, and it is not an accident: REG allocates more of the exam to straightforward recall than any other Core section.

It is also the section where a Gulf-based candidate's day job helps least. Everything in it is United States federal law. Your experience of Saudi Zakat, VAT and withholding tax is professionally valuable and examinally irrelevant here, and candidates who assume tax is tax lose time discovering otherwise.

This guide covers what REG contains, how the weightings should shape your hours, and how to study a body of law you have never practised.

What REG covers

Area	Weight	What sits inside it
I. Ethics, Professional Responsibilities and Federal Tax Procedures	10 to 20%	Circular 230, preparer responsibilities and penalties, licensing, IRS procedure, statutes of limitation
II. Business Law	15 to 25%	Contracts, agency, debtor and creditor relationships, secured transactions, bankruptcy, business structures, employment taxes, worker classification and the federal anti-bribery rules
III. Federal Taxation of Property Transactions	5 to 15%	Basis of assets bought, gifted, inherited or converted to business use, basis of intangibles, cost recovery through MACRS, bonus depreciation, Section 179 and amortisation
IV. Federal Taxation of Individuals	22 to 32%	Gross income, adjustments, deductions, credits, filing status, loss limitations
V. Federal Taxation of Entities	23 to 33%	C corporations, S corporations, partnerships, limited liability companies, tax-exempt organisations, book to tax differences, owner basis and cash distributions

Add Areas III, IV and V and you get 50 to 80% of the exam in tax, before counting the federal tax procedures sitting inside Area I. REG is a tax exam with a substantial law component attached, and any study plan that treats the two halves as equal is misweighted.

Note what is not on that list. Like-kind exchanges, involuntary conversions, depreciation recapture, at-risk and passive activity loss limitations, trusts and entity formation are tested in TCP, not in REG. REG takes the routine and recurring transactions; TCP takes the nonroutine ones, and the TCP study guide covers that half.

Business law is the part that surprises international candidates

Area II is up to a quarter of the paper and is the least intuitive material on the entire CPA Exam for anyone trained outside a common-law system.

Contract formation, agency, secured transactions under Article 9 and the bankruptcy chapters are not general commercial principles that translate from Saudi or Egyptian commercial law. They are specific American rules with specific triggers and exceptions. If your legal training, formal or on the job, is civil-law based, budget more time for Area II than a US candidate would, and treat it as memorisation of a foreign system rather than as reasoning from principles you already hold.

The good news is that this makes it decidable. Business law questions usually have a determinate answer once you know the rule, which is exactly the kind of material that rewards study.

The skill levels

REG's Blueprint allocates roughly 25 to 35% Remembering and Understanding, 35 to 45% Application, and 25 to 35% Analysis, with no Evaluation component.

A quarter to a third of REG can be secured by knowing things properly, which is more than double FAR's recall allocation. This is most of why the pass rate is higher, and it is the single most actionable fact about the section: in REG, learning the rules actually pays. In FAR it is barely the entry ticket.

How the exam is built

Item	REG
Length	4 hours
Multiple choice questions	72
Task-based simulations	8
Score weighting	50% MCQ, 50% TBS
Testing availability	Continuous, as a Core section
2026 pass rate	66.78% cumulative
Skill allocation	Remembering and understanding 25 to 35%, application 35 to 45%, analysis 25 to 35%, no evaluation items
Passing score	75 on a 0 to 99 scale
Credit window	30 months from the score release of your first passed section, adopted board by board

Eight simulations is the most of any section. Most sections have seven; ISC has six. Those eight still carry the same 50% of the score, and several of them will be tax computations with multiple linked figures, which are slow. Seventy-two multiple choice questions plus eight simulations in four hours is a genuine pace problem, and REG is the section where running out of time is most often what happened, rather than not knowing the answer.

The topics that decide the result

Basis, basis, basis

If REG has one central concept, it is basis. Basis determines gain and loss on property transactions, it determines what a partner can deduct, it determines the tax effect of a corporate distribution, and it carries over and adjusts through almost every entity transaction in Area V.

Candidates who understand basis as one idea that recurs, rather than as a separate rule per topic, find Areas III and V collapse into something far smaller than they look. Candidates who do not, memorise a dozen unrelated formulas and mix them up under time pressure.

Individual taxation and the order of operations

Area IV is a sequence: gross income, then adjustments to reach adjusted gross income, then deductions, then the tax, then credits. A large share of individual tax questions are really testing whether you know which step an item belongs to, because an item that reduces AGI and an item that reduces taxable income are worth different amounts.

Learn the sequence as a skeleton first, then hang items on it. Learning items first and inferring the sequence is how candidates end up applying a deduction in the wrong place.

Entities: compare them, do not learn them separately

Area V examines C corporations, S corporations and partnerships, and it examines them by contrast far more often than in isolation. The examinable content is largely the differences: how income is taxed, how distributions are treated, how basis moves, what restrictions apply.

Build a comparison table from the start and fill it in as you study, rather than studying three entity types end to end and trying to compare them at the end. The table is what the exam is asking about.

Ethics and tax procedures

Area I is rules driven, finite and cheap to secure. Circular 230, preparer penalties and statutes of limitation are learnable in a week and appear reliably. This is the area most commonly left to the end and most commonly under-done relative to its yield.

A study plan

Ten weeks at twelve to fifteen hours a week, weighted towards the tax areas as the Blueprint is:

Weeks	Focus	Why here
1	Ethics, Circular 230, preparer responsibilities, tax procedure	Self-contained and quickly secured. Removes it from your mind for the rest of the plan.
2 to 3	Individual taxation: income, adjustments, deductions, credits	The largest single area and the foundation for entity work.
4	Property transactions and basis	Do this before entities. Entity questions assume it.
5 to 6	Entities: C corps, S corps, partnerships, by comparison	The other largest area, and only tractable once basis is secure.
7 to 8	Business law	Alien material for many international candidates, so give it two clean weeks rather than fragments.
9	Simulations under time	Eight of them, half your marks, and slower than they look.
10	Full mocks and targeted repair	REG's real risk is pace. Rehearse it.

Two rules specific to REG:

1. Do not chase current-year thresholds and inflation-adjusted figures. The exam tests structure far more than it tests this year's exact standard deduction. Knowing that a limitation exists and how it operates is worth more than the number.
2. Practise computations end to end. REG simulations chain figures: a wrong basis at step one produces a wrong gain, a wrong deduction and a wrong tax. Practising fragments hides that risk.

If TCP is your Discipline

TCP extends REG directly and has the highest pass rate on the exam at 79.53%, largely because the people sitting it are tax specialists who have usually just passed REG. That overlap is real and worth using: sitting TCP in the first available window after REG is the single most efficient pairing on the CPA Exam.

The constraint is that Discipline sections run only in the first month of each quarter, so it has to be planned rather than discovered. See Sequencing the CPA Exam Around the Discipline Windows, and CPA Exam Pass Rates by Section for why that 79.53% is not the invitation it appears to be if you have no tax background.

A note for candidates working in the Gulf

Nothing in REG is about Saudi, Emirati or Egyptian tax. There is no Zakat, no GCC VAT and no ZATCA. The withholding tax you deal with at work operates on entirely different principles from US withholding on non-resident payments.

Treat REG as a foreign body of law learned from scratch, which is what it is, and the section becomes much more predictable. If your interest is the tax you actually practise, that is the SOCPA Zakat and Tax syllabus, which is a different qualification and a different exam.

Where to practise this

REG rewards volume and repetition more than insight, and it punishes slow computation. Prepito's REG course covers the full blueprint with practice questions, timed simulations, full explanations and mistake review, in English, and TCP is available for the Discipline that follows it.

CPA questions and written explanations are in English. Prepito’s interface is available in English and Arabic, and the AI tutor can respond in either language.

See also the FAR study guide and the AUD study guide for the other two Core sections, or the CPA programme for the whole qualification.

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Sources: AICPA CPA Exam Blueprints, AICPA guidance on Exam scoring and pass rates. Blueprint weightings are ranges and are revised periodically, and US tax thresholds change annually; confirm the current Blueprint and the applicable tax year for your testing window. Pass rates cited are cumulative for the first two quarters of 2026.