TCP — Tax Compliance & Planning (Discipline)·Tcp Overview

TCP — Tax Compliance and Planning: Overview

Exam: CPA — Certified Public Accountant Section: TCP — Tax Compliance and Planning (Discipline) Last Updated: 2026-06-26

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Key Takeaways

  • TCP is one of three Discipline sections; candidates choose one of BAR, ISC, or TCP.
  • TCP is 4 hours, with 68 MCQs and 7 TBSs.
  • TCP goes deeper than REG on individual and entity tax — it adds personal financial planning and advanced compliance topics.
  • OBBBA provisions (TCJA permanent, SALT cap, estate exemption) are testable on TCP starting July 1, 2026.
  • Best fit for candidates planning careers in tax — public accounting, private industry tax, or advisory.

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    TCP vs. REG: Understanding the Difference

    Many candidates choose TCP because they work in tax. It is important to understand that TCP does not repeat REG — it builds on it.

    | Area | REG Coverage | TCP Coverage | |---|---|---| | Individual income tax | Filing requirements, common deductions, standard credits | Advanced scenarios: nonroutine income, complex phase-outs, multi-year strategies | | Passive activity / at-risk | Basic rules | Complex structures, grouping elections, real estate professional | | Retirement | Contribution limits, basic RMD rules | Distribution planning, SECURE 2.0 implications, Roth conversion strategy | | Estate and gift | Basic rules tested lightly | Valuation concepts, GRATs, trusts, portability elections, marital deduction | | International tax | Not tested | GILTI, FDII, Subpart F income, FTC calculations | | Personal financial planning | Not tested | Insurance, education funding, integrated cash flow planning |

    Exam Tip: Candidates who do well on REG but stopped there should expect TCP to require significant additional preparation, particularly in areas REG barely touched (international, estate planning, personal finance).

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    Content Area Weight Distribution

    | Content Area | Approximate Weight | |---|---| | Individual tax compliance and planning | 30–40% | | Entity tax compliance and planning | 20–30% | | Personal financial planning (tax context) | 10–20% | | Gift, estate, and trust taxation | 10–20% | | International taxation basics | 5–15% |

    Note: Confirm against current AICPA Blueprint at aicpa.org.

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    Key Topics by Area

    Advanced Individual Tax

  • Nonroutine income: discharge of indebtedness, below-market loans, stock options (ISO vs. NQSO), restricted stock
  • Phase-out computations: Roth IRA eligibility, child tax credit, AOTC, education savings deductions
  • Net investment income tax (3.8%) and additional Medicare tax (0.9%)
  • Alternative minimum tax (AMT): computation, preferences, adjustments, exemptions
  • Qualified business income (QBI) deduction: W-2 wage test, UBIA, SSTB limitations, aggregation elections
  • OBBBA provisions: TCJA rates permanent, SALT cap $40K MFJ, standard deduction amounts

    • Exam Tip: TCP emphasizes planning (what should the client do?) as much as compliance (what are the rules?). Expect scenario questions where the candidate must recommend a strategy and justify it.

    Entity Tax Compliance

  • S corporation elections, eligibility, and revocation
  • Shareholder basis tracking in S corps and partnerships
  • Basis adjustments from distributions, income, and loss
  • Built-in gains tax (S corporations)
  • At-risk rules and passive activity interactions in entity context
  • Partnership special allocations and substantial economic effect

    • Retirement and SECURE 2.0

  • RMD age: 73 (current); 75 in 2033
  • Super catch-up contributions: ages 60–63, $11,250 (2025)
  • 529-to-Roth rollovers: conditions, lifetime limit ($35,000), annual limit
  • Roth conversion analysis: when to convert, estimated taxes, breakeven
  • Inherited IRA rules: 10-year rule for most non-spouse beneficiaries (post-SECURE 1.0)
  • Emergency expense distributions and student loan match provisions

    • Personal Financial Planning (Tax Context)

  • Life insurance: inside buildup, policy loans, death benefit taxation
  • Education planning: 529 plans, Coverdell ESAs, AOTC vs. LLC vs. deduction
  • Cash flow and budgeting in tax planning context
  • Long-term care insurance and medical expense deductions
  • Social Security taxation: provisional income formula, optimal claiming age

    • Gift, Estate, and Trust Taxation

  • Annual exclusion: $19,000 per recipient (2025)
  • Unified exemption: $15,000,000 per person (OBBBA, 2025, indexed to inflation)
  • Gift tax return filing requirements (Form 709)
  • Portability election: surviving spouse's DSUE
  • Grantor trusts vs. non-grantor trusts: tax treatment
  • GRATs (Grantor Retained Annuity Trusts) and intentionally defective grantor trusts (IDGTs)

    • International Tax (Introductory)

  • Foreign tax credit (FTC): direct vs. indirect; limitation computation
  • GILTI (Global Intangible Low-Taxed Income): US shareholders of CFCs
  • Subpart F income: passive income of CFCs currently included
  • FDII: Deduction for foreign-derived intangible income
  • FBAR and Form 8938 filing obligations for foreign accounts/assets

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    OBBBA Provisions Testable on TCP (Starting July 1, 2026)

    | Provision | Old Law (TCJA expiring) | OBBBA Permanent Law | |---|---|---| | Individual tax brackets | 7 brackets, sunsetting 2026 | Permanent | | Standard deduction | $14,600 (2024 pre-OBBBA) | $15,750 single / $31,500 MFJ | | SALT cap | $10,000 | $40,000 MFJ (confirm current figure) | | Estate exemption | ~$13.99M (2024) | $15M per person (2025, indexed) | | QBI deduction (199A) | Sunsetting 2026 | Permanent |

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    Who Should Choose TCP

    TCP is the right Discipline for candidates who:

  • Work in or intend to work in tax (public accounting tax, private industry tax counsel, advisory)
  • Found REG to be their strongest Core section
  • Want to develop deep expertise in individual and entity tax planning
  • Are interested in estate planning, high-net-worth client work, or international tax

TCP is generally considered the most tax-intensive CPA section ever offered. It rewards candidates with real-world tax experience.

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Exam Tip Summary

| Topic | Watch For | |---|---| | TCP vs. REG | TCP adds planning + advanced scenarios; not a REG repeat | | OBBBA | Testable July 1, 2026; TCJA permanent, SALT $40K MFJ, estate $15M | | RMD age | 73 now; 75 in 2033 | | Super catch-up | Ages 60–63 only; $11,250 in 2025 | | ISO vs. NQSO | ISO: no regular tax on exercise (but AMT); NQSO: ordinary income on spread | | Unified exemption | $15M per person (2025); portability doubles for married couples | | GILTI | US shareholders include their pro-rata share of CFC's GILTI currently |

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