Common Items Subject to the Alternative Minimum Tax (AMT):
- Tax-exempt interest from Private Activity Bonds
- Gain on Small Business Stock qualifying for exclusion
- Intangible Drilling Costs
- Passive Income or Loss
- Investment Expenses
- Personal Exemptions
- Standard deduction
- Mining Exploration & Development Costs
- Income from exercising incentive stock options
- Accelerated Depreciation in excess of straight line
- Itemized deductions for taxes, miscellaneous and medical expenses
Calculation of the AMT:
Regular Taxable Income
(+) Positive AMT Adjustments
(-) Negative AMT Adjustments
(=) Taxable Income after AMT Adjustments
(+) Tax Preferences
(=) Alternative Minimum Taxable Income (AMTI)
(-) AMT Exemption
(=) Minimum Tax Base
(x) AMT Rate
(=) Tentative AMT
(-) Regular income tax on taxable income
AMT Tax Rates
26% Rate - applies to AMT taxable income of $182,500 or less (after the AMT exemption), $91,250 or less if married filing separately.
28% Rate - applies to AMTI exceeding the $182,500 or $91,250 threshold.
AMT Exemption Amounts
|Filing Status||Exemption Amount 2014||Phaseout*|
|Married, filing separately||$41,050||$ 78,250+|
*The exemptions are phased out by 25% of the excess of AMTI over the listed amount.
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