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APPENDIX
The taxpayer's tentative minimum tax is computed as follows.
The taxable income, as it is normally calculated, is recomputed
to create a new tax base, the alternative minimum taxable income
(AMTI). See sec. 55(b)(2). The normal taxable income is reduced
by the adjustments provided for in sections 56 and 58 and
increased by the amount of the items of tax preference described
in section 57. In petitioner's case, the only applicable
adjustment from these sections is the disallowance of the
standard deduction and the personal exemption. See sec.
56(b)(1)(E). Petitioner's regular taxable income was $155,599
and was increased by the previously allowed deduction of $5,750
and exemption of $7,926. His AMTI was $169,275.
The AMTI is then reduced by the special AMT exemption
allowed according to the taxpayer's status. See sec. 55(d). For
taxpayers who are unmarried but not widowed, like petitioner, the
exemption amount is $33,750. See id. However, the exemption
amount is phased out if the AMTI exceeds a certain amount. For
unmarried, not widowed, individuals, 25 percent of income
exceeding $112,500 is subtracted from the exemption amount. See
id. Petitioner's AMTI exceeded $112,500 by $56,775. Twenty-five
percent of that is $14,194, so petitioner's $33,750 exemption is
reduced to $19,556.
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