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I’m a law student taking Federal Income Tax. My study group has a practice question that asks if Section 83 of the IRC which deals with "Property transfered in connection with the performance of services."

I assume it doesn’t because, other than it seeming to relate to stock options or other property that fluctuates in value, Reg 1.83(e) states: "For purposes of section 83 and the regulations thereunder, the term "property" includes real and personal property other than either money or an unfunded and unsecured promise to pay money or property in the future. The term also includes a beneficial interest in assets (including money) which are transferred or set aside from the claims of creditors of the transferor, for example, in a trust or escrow account."

It seems to clearly exclude cash or "money" from being included but then the second sentence that talks about a beneficial interest in money has our group slightly confused.

As finals are approaching, any insights are appreciated.

Um, Section 83 has to do with payment in the form of stock options. Period.

If you got paid cash, then you would not even have the option for deferred treatment of capital gains because there IS NO CAPITAL GAINS for cash compensation.

This is like asking if you go the the stock broker and buy some US Currency with your cash in your pocket. I doubt the cash you get will be worth anything but the cash value on the face of the money today tomorrow or next decade.

– A Damn Fine Tax Advisor

My husband and I are trying to obtain two cell phones that do not require a down deposit/credit check, due to his paycheck being issued 2 weeks from now (started a new occupational position.) Does anyone know of any companies of cell phone carriers that do not require money down and will allow you to obtain the phones, and only require you to pay the bill when it comes in the following month?
We reside in Florida, if that helps regarding cellular companies. Thank you so much.

I would suggest a basic pay as you go phone. Virgin mobile is one option:

http://www.virginmobileusa.com/cell-phone-plans/beyond-talk-plans.jsp

The phones and service are good.

What are real estate investment trusts or REITs and how do they work. Is there some law that give these trust some tax efficiency status and how can investors invest in these REITs. With the real estate market in the US the way as it is, is it a good time to invest in the property market through real estate investment trusts. What kind of people manage these funds or trusts and what are their typical return on investments?

A REIT buy’s skyscrapers, shopping malls, apartment complexes, office buildings, or housing developments. Rather than investing directly in real estate, investors of REIT’s invest in a professionally managed portfolio of real estate.

REIT’s trade on the major exchanges, just like stocks. REIT’s make their money from the rental income, profits from the sale of the property and other services provided to the tenants. REIT’s also receive special tax considerations; they do not pay taxes as long as they pay out at least 90% of their net income to investors. Thus, successful REIT’s can offer investors high yields, current income, and moderate growth. But, while these tax considerations benefit the REIT, the investor still has to pay tax on the growth just like a share of stock.

There are several types of REIT’s:

There is a equity REIT. It’s main objective is buying, renovating, managing, maintaining, and selling real estate. This is the most common type.
There is the mortgage REIT. It makes loans or invests in existing mortgages.
Hybrid REIT’s do a combination of both.
Then there are UPREIT’s and DownREIT. These were developed in the early 90′s to provide tax benefits to their shareholders.

Advantages:

All REIT’s are governed by strict regulation. REIT shares are more liquid than investing directly in real estate. The REIT’s are professionally managed. Open up investment opportunities that may not be available to the average investor. Provide annual income. Disadvantages:
Supply and demand imbalance. Booms and busts can impact office space activity. Rising interest rates. This increases borrowing costs and impact bottom line. This could also slow down rentals and purchases if interest rates increase. Subject to risks associated with the general real estate market including possible declines in the value of real estate, decline in economic conditions, and possible lack of availability of mortgage funds. Use as a tax shelter is limited. REIT’s are not allowed to pass losses through to their investors. So, if the REIT loses money, you won’t be able to use the loss to offset other investment gains. Dividends paid from a REIT are taxable as income. A portion of a REIT dividend may be taxed an a lower capital gain rate. For tax years beginning on or after January 1, 2003 and before January 1, 2011, qualifying dividends paid to individual shareholders from domestic corporations (and qualified foreign corporations) are taxed at long-term capital gains tax rates. For tax years prior to January 1, 2003, however, stock dividends were taxed at ordinary income tax rates, generally resulting in significantly more tax due. Absent further legislative action, stock dividends will again be taxed as ordinary income beginning in 2011.
Capital gain tax liability may occur when you sell your shares. If you sell the share for more than you bought it for. Just like stock.
When looking to invest in a REIT, you can do the same research as you would have done in researching a share of stock. Because they are publicly traded companies you can look at their earnings, both past performance and potential for future growth, dividend yield, payout ratio, and price-earnings ratio. By keeping an eye on the real estate market you may be able to detect certain shifts in the market, overbuilding, current buildings where office space is sitting empty, or where certain types of business are closing because of economic situations. This way you can more to another type of REIT that may work better in a certain kind of market.

You can go the Forbes magazine REIT gold list to see different REIT companies, what they are invested in, and what the performance is. http://www.forbes.com/2008/02/20/reit-perfomance-grades-biz-cx_dp_0220reit_table.html

I know I don’t need a degree but I’ll have the GI Bill so what would be a good major? All i can think of is accounting but can you major in real estate or investing, i have no idea

You should definitely take advantage of the GI Bill. My father was in the Army and never did. He always makes it a point to tell us this whenever somebody considers not going to school.
If I were you, I would either go to school for Finance, Economics, or just generic business (can usually concentrate in other subjects). Assuming you do this, make sure you go to a school that is AACSB accredited. This is for the best business schools but more and more are getting it. The best thing about this is if you want to go to a grad school that is accredited, generally they only accept students from other schools that are accredited as well.
Going into Finance will give you the background in investment fundamentals (and in depth, too) like rates of return, future values, as well as determining if projects are worth your investment. Before, during or after this you will definitely want to become a licensed real estate agent and then broker. Some states require a license to even "flip" houses.
After an undergrad degree, don’t feel like you have to stop. A friend of mine is going to law school right now and has been talking non-stop about his real estate law courses! Good luck!