What Is the CPA Exam Taxation and Regulation (REG) Section?

The REG section of the CPA Exam is one of three required core sections under the current CPA Evolution model. It’s a four-hour computerized test covering federal taxation, business law, and professional ethics, delivered at Prometric centers on a continuous testing schedule. You need a scaled score of 75 to pass, and the cumulative pass rate was about 63% in 2025.¹

What REG Covers

The AICPA publishes annual Blueprints that spell out exactly what’s testable. The 2026 Blueprints divide REG into five content areas with weighted ranges:²

Ethics, Professional Responsibilities, and Federal Tax Procedures (10–20%). Treasury Department Circular 230 conduct rules, tax preparer penalties, due diligence, and client representation.³
Business Law (15–25%). Contracts, agency, debtor-creditor rules, and the Uniform Commercial Code, with Article 2 (sales of goods) and Article 9 (secured transactions) appearing repeatedly.⁴
Federal Taxation of Property Transactions (5–15%). Basis, gain and loss recognition, and the capital-versus-ordinary distinction under IRC Section 1221.⁵
Federal Taxation of Individuals (22–32%). Gross income, above-the-line adjustments, standard versus itemized deductions, and credits.⁶
Federal Taxation of Entities (23–33%). C corporations, S corporations, and partnerships across formation, operation, and liquidation, including flow-through mechanics and entity-specific rules like the dividends-received deduction.

The weightings are ranges, not fixed percentages, so one candidate’s exam might lean harder on entity taxation than another’s. What stays constant is that individual and entity taxation together account for roughly half the test or more.

Exam Format and Timing

REG runs four hours and is split into five testlets. The first two testlets deliver 72 multiple-choice questions between them. The remaining three testlets deliver 8 task-based simulations. A 15-minute break falls between the second and third simulation testlets and does not count against your four hours.²

Multiple-choice questions test knowledge and application of tax rules, business law, and ethics. Simulations are where the exam gets more demanding. You might complete a tax return, research a specific Internal Revenue Code section in a simulated authoritative database, or work through a multi-step calculation in a spreadsheet-like tool. Higher-level analysis skills appear almost exclusively in the simulations.

Because REG is a core section, it’s available year-round under continuous testing. You can schedule an appointment on any available date at a Prometric center rather than waiting for a testing window.⁷

Which Version of Tax Law Applies

REG doesn’t automatically test the most recent law. The AICPA’s rule: changes to the Internal Revenue Code become eligible for testing in the calendar quarter that begins six months after the change’s effective date or enactment date, whichever comes later.⁸

That rule creates a real decision point right now. The One Big Beautiful Bill Act made sweeping changes to deductions, credits, and depreciation, and those provisions become testable on REG starting July 1, 2026. Sit before that date and you’re tested on pre-OBBBA law. Sit on or after, and the new rules apply. The changes include an increased standard deduction, a higher child tax credit, a $40,400 cap on the state and local tax deduction, permanent 100% bonus depreciation, and expanded Section 179 expensing limits.

If you’ve been studying pre-OBBBA material, there’s a case for taking REG before July. If you’re starting preparation in mid-2026, you’ll be learning the new law from the outset.

Scoring and Passing

Scores range from 0 to 99, and 75 is passing. That’s not a percentage of questions correct. It’s a scaled score that accounts for the difficulty of the specific questions on your version of the exam, so a 75 on one form represents the same competency as a 75 on any other.¹

For core sections in 2026, the AICPA releases scores on a rolling schedule roughly two to three weeks after receiving your exam data file. Target release dates are published in advance so you can look up when to expect results.⁷ Results flow to NASBA first and then appear in your online candidate portal.

If you don’t pass, your score report includes a diagnostic breakdown by content area. That breakdown is the single most useful study tool you’ll get before your next attempt. A candidate who scored well on individual taxation but poorly on business law knows exactly where to focus.

Retakes and the 30-Month Credit Window

Continuous testing means no mandatory waiting period after a failed REG attempt. The practical delay is just the time it takes to receive your score, re-register, get a new Notice to Schedule, and find an open Prometric appointment, which usually adds up to a few weeks.⁹

The bigger scheduling constraint isn’t retakes. It’s the credit clock. Once you pass your first section, you have a limited window to pass the remaining three before that earliest credit expires. In 2023, NASBA amended its model rules to extend that window from 18 months to 30 months, measured from each section’s score release date.¹⁰

NASBA’s model rules are recommendations. Each state board adopts them through its own rulemaking, and while many have gone to 30 months, your jurisdiction might still use 18 months or a different figure. Confirm with your state board before building a study timeline. The window is also rolling, which means each section’s clock runs independently. Pass REG in January and FAR in June, and the REG credit expires 30 months after its own score release, not the FAR date. Losing credit on a section you already passed is the outcome most candidates most want to avoid.

Scheduling and Fees

Before you can sit for REG, your state board of accountancy must verify that you meet its education requirements and approve your application. Once approved, you receive a Notice to Schedule, which is your ticket to book through Prometric’s online system and the document you bring on test day.¹¹ The name on your application must match your government-issued ID exactly, because Prometric will turn you away for a mismatch.¹²

Two fee categories apply: a state board application or registration fee, and NASBA’s per-section examination fee. Amounts vary by jurisdiction; some states bundle them and others bill separately. Testing at an international location outside the United States and Canada adds an international administration fee.¹²

Your NTS has an expiration date, and its validity period varies by jurisdiction. Miss it and the NTS becomes invalid, forcing a new application and new fees.⁹ Check the expiration date the day you receive the NTS and schedule your appointment immediately.

Passing REG Isn’t the Same as Getting Licensed

REG is one section of four. Passing it and the other three doesn’t automatically make you a CPA. Most states require one to two years of supervised work experience verified by a licensed CPA, and many require a separate professional ethics exam that’s distinct from the ethics content on REG. The AICPA offers one such course with a 90% passing threshold for initial licensure, but many states require their own approved course instead.¹³ Confirm which course your state board accepts before you sit for it.¹⁴

1
AICPA & CIMA. Learn More About CPA Exam Scoring and Pass Rates
2
AICPA & CIMA. Uniform CPA Examination Blueprints 2026
3
Internal Revenue Service. Office of Professional Responsibility and Circular 230
4
Legal Information Institute. Uniform Commercial Code Article 2 – Sales
5
Office of the Law Revision Counsel. 26 USC 1221 – Capital Asset Defined
6
Internal Revenue Service. Instructions for Schedule A (Form 1040)
7
AICPA & CIMA. Find Out When You Will Get Your CPA Exam Score
8
AICPA & CIMA. Learn What Is Tested on the CPA Exam
9
NASBA. CPA Exam FAQ
10
NASBA. NASBA Announces Historic Rule Amendment Following Record Exposure Draft Response
11
NASBA. What Exactly Is a Notice to Schedule (NTS)
12
Prometric. CPA Exam Information
13
AICPA & CIMA. Professional Ethics – The American Institute of Certified Public Accountants Comprehensive Course (For Licensure)
14
NASBA. How to Get Licensed