Arthur O. & Wanda E. Trevino - Page 3




                                        - 2 -                                         
               Respondent determined a deficiency in petitioners’ Federal             
          income tax of $2,483 for the taxable year 1998.                             
               The issue for decision is whether and to what extent                   
          petitioners are liable for the alternative minimum tax (AMT).               
               Some of the facts have been stipulated and are so found.               
          The stipulations of fact and the attached exhibits are                      
          incorporated herein by this reference.  Petitioners resided in              
          Mayaguez, Puerto Rico, on the date the petition was filed in this           
          case.                                                                       
               There are no disputed facts in this case.  During 1998,                
          petitioners’ primary sources of income were petitioner husband’s            
          Federal government salary of $56,746 and a distribution from his            
          Federal retirement account of $97,796.  Petitioners filed a joint           
          Federal income tax return for taxable year 1998.  On that return            
          they reported a foreign tax credit of $34,616 and zero tax                  
          liability.  They also reported zero liability for the AMT.  In              
          the statutory notice of deficiency, respondent determined that              
          petitioners are liable for the AMT in the amount of $2,483.  This           
          is in accord with our calculation under section 55(a), which is             
          as follows:                                                                 
               Taxable income reported by petitioners1                   $129,603     
               Exemption deductions claimed by petitioners                   10,800   
               Itemized deduction claimed by petitioners for taxes paid         999   
               Amount of section 68(a) limitation on itemized deductions       (897)  
               Alternative minimum taxable income                           140,505   
               Exemption amount                                             (45,000)  
               Taxable excess                                                95,505   
               Pre-credit tentative minimum tax (26% of taxable excess)      24,831   
               AMT foreign tax credit (limited to 90% of $24,831)           (22,348)  





Page:  Previous  1  2  3  4  5  Next

Last modified: May 25, 2011