l****n
发帖数: 144 | 1 又到报税的季节了，我在网上研究AMT，研究得头大如斗。 没啥头绪。
有哪位大侠，达人方便解答一下吗？
AMT是指如果itemized deduction如果太多 就会trigger AMT是吗？ 而ATM 的税率比普
通的高，
是吗？ AMT跟收入有没有关系？ 有没有什么办法避免AMT的发生？
多谢！ | t***s
发帖数: 4666 | 2 是。是。有。不要deduct。
【在 l****n 的大作中提到】
: 又到报税的季节了，我在网上研究AMT，研究得头大如斗。 没啥头绪。
: 有哪位大侠，达人方便解答一下吗？
: AMT是指如果itemized deduction如果太多 就会trigger AMT是吗？ 而ATM 的税率比普
: 通的高，
: 是吗？ AMT跟收入有没有关系？ 有没有什么办法避免AMT的发生？
: 多谢！
| S****Y
发帖数: 4634 | 3 基本上是一个平行的tax system.
flat tax rate with few deduction.
and you pay whichever is higher.
enjoy
【在 l****n 的大作中提到】
: 又到报税的季节了，我在网上研究AMT，研究得头大如斗。 没啥头绪。
: 有哪位大侠，达人方便解答一下吗？
: AMT是指如果itemized deduction如果太多 就会trigger AMT是吗？ 而ATM 的税率比普
: 通的高，
: 是吗？ AMT跟收入有没有关系？ 有没有什么办法避免AMT的发生？
: 多谢！
| s******g
发帖数: 654 | 4 If you cannot handle it by yourself or you want best scenario/analysis
results, contact me every year from November 1 ~ December 15. The review of
your case will be free. The custom tax planning/projection to minimize/
eliminate your AMT will be $400 for 2011. You will get what you pay for.
============================================================================
====
How can I escape the AMT?
One of the best things that can be said about the AMT is that Congress was
successful in making it difficult to get around this tax. To avoid the AMT,
you need to understand how the AMT differs from the regular tax system.
We'll walk through Form 6251, line by line, looking at how the AMT handles
different deductions and expenses. Wherever we see a tax-planning
opportunity, we will suggest how to lessen the impact of the AMT.
Line 1: Adjusted Gross Income: If you itemize, this line is the amount shown
on line 41 of your 1040, which is your Adjusted Gross Income (AGI) minus
your itemized deductions (some of which are added back in on the following
lines). If you take the standard deduction instead, this line is solely your
AGI from line 38 of your 1040, because you can't take any part of the
standard deduction when calculating the AMT. So if you took the standard
deduction on your regular return, it is effectively added back into your
income here.
In calculating the AMT you cannot take the deductions for personal
exemptions. Because the amount on line 38 or 41 of the 1040 is used as the
starting point for computing the AMT, the personal exemptions (which are
claimed on line 42 of the 1040) are effectively added back into your income
for AMT purposes. This is one of the reasons why married couples with
children are strongly affected by the AMT. If you are a married couple with
three children, you lose $18,250 ($3,650 x 5) in personal exemptions under
the alternative minimum tax in 2010.
Line 2: Medical Expenses: If you itemize deductions, medical deductions are
only allowed to the extent that they exceed 10 percent of adjusted gross
income, rather than 7.5 percent under the regular tax system.
Suggestion: If your employer has a pre-tax medical deduction plan, sign up
for it. You can reduce your salary to pay your medical expenses on a pre-tax
basis, which will help you reduce both the AMT and your regular tax.
Line 3: Taxes: In calculating the AMT, you cannot take itemized deductions
for state and local income tax, real estate taxes and personal property
taxes, even though these are deductible on your regular return.
Suggestion 1: In a year that you have to pay the AMT, don't bother prepaying
real estate or fourth-quarter state estimated tax payments in December. You
get no benefit from paying these taxes in a year that you are subject to
the AMT.
Suggestion 2: Real estate and personal property taxes are not deductible for
AMT if they are part of itemized deductions. Taxes deductible on a business
schedule (Schedule C), rental schedule (Schedule E), or farm schedule (
Schedule F or Form 4835) are allowed for the AMT.
•Perhaps you can qualify for a home office, which would allow you to
deduct part of your home real estate tax on Schedule C.
•If you have a farm operation and use your car in your work, you could
deduct the personal property tax on the car on Schedule F.
•If you have vacant arable land on which you are paying real estate
taxes, you could turn it into a farm rental and deduct the taxes on Form
4835.
Line 4: Home Equity Interest: Home mortgage interest claimed as an itemized
deduction is only deductible for the AMT if the loan was used to buy, build
or improve your home. For regular tax purposes, interest on home equity
mortgages up to $100,000 is deductible, even if you used the proceeds for
personal purposes, such as buying a car or paying off credit card debt. So
unless the home equity loan proceeds were used to improve your home, the
interest is added back for AMT purposes.
Suggestion: If you are subject to the AMT, there is no advantage to using
your home equity line of credit to buy a car, because the interest will not
be deductible. You may be able to get a lower interest rate from a regular
car loan. If the car is used in your business, you may be able to write off
some of your auto loan interest as a business expense on Schedule C.
Line 5: Miscellaneous Itemized Deductions: Miscellaneous itemized deductions
are not deductible for AMT purposes. Often generated by employee business
expenses, these itemized deductions can save you a lot of money on your
regular return. If so, when the AMT puts them back into your taxable income,
you could face a big problem.
The deduction for qualified motor vehicle taxes on autos purchased on or
after February 17, 2009 and before January 1, 2010 is allowed in computing
the AMT, whether the taxpayer itemizes or claims the standard deduction.
Suggestion 1: Employee business expenses (Form 2106) are incurred by
employees, not self-employed individuals. These are work-related expenses
not reimbursed in full by your employer. They become miscellaneous
deductions on Schedule A, Itemized Deductions, and can only be deducted to
the extent that all miscellaneous deductions exceed 2% of your adjusted
gross income. Only the excess amount can be deducted. If you are in this
situation, ask your employer to start reimbursing you for your business
expenses.
If your employer has a non-accountable business expense plan (explained
below), encourage him or her to adopt an accountable plan.
•In a non-accountable plan, your employer gives you an expense advance
check and you are not required to keep records of your purchases.
•The advance is included in your income, and you take your expenses as
miscellaneous itemized deductions.
•In the AMT system, you are taxed on the expense advance, but can't
take a deduction for the expenses.
To avoid this situation, encourage your employer to change to an accountable
plan. With this plan, you turn in your receipts to your employer and you
must refund any expense advance not used. Because you are not taxed on the
advance and you do not take a deduction for the expenses, you avoid being
hit by AMT rules.
Suggestion 2: If you have employee business expenses that your employer
refuses to reimburse, and you know that these expenses are causing you to
pay the AMT, consider negotiating with your employer. You may be better off
by having the employer pay some of these expenses in exchange for a lower
salary. Your employer will save on payroll taxes, workers' compensation
insurance, and in some cases liability insurance premiums, and you will
reduce your taxable income and possibly avoid the AMT altogether.
Line 6: Phaseout of Itemized Deductions: The good news is that the phase-out
rules for 2010 are gone. In addition, the 2010 Tax Relief Act passed in
late December extends the repeal of the phaseout rules through the end of
2012.
Line 7: State Tax Refund: If you have a taxable state tax refund on your
regular tax return, it does not count as taxable income for AMT purposes
because you do not receive a corresponding deduction for state taxes.
Line 8: Investment Interest: The investment interest deduction may be
different for AMT purposes because it depends on whether you have taxable
private activity bond interest (see line 12). If you do, you may have an
additional deduction for investment interest.
Line 9: Depletion: You can calculate depletion from mining, oil, gas, timber
or other similar activities for regular tax purposes using either the cost
or percentage depletion method. For AMT, only the cost method is allowed.
Suggestion: If this line is generating AMT on your tax return, consider
electing the cost method of depletion.
Line 10: Net Operating Loss: If you claimed a net loss operating deduction
on Form 1040, enter it here as a positive number.
Line 11: Alternative Tax Net Operating Loss Deduction: This is the sum of
the alternative tax net operating loss (ATNOL) carryovers and carrybacks to
the tax year.
Line 12: Private Activity and Tax-Exempt Bond Interest: The American
Recovery and Reinvestment Tax Act, passed in 2009, repealed the individual
and corporate AMT for all tax-exempt bonds issued in 2009 and 2010.
Refunding bonds which refund obligations issued after December 31, 2003 are
also excluded from the AMT.
Normally, tax-exempt interest from private activity bonds is not tax-exempt
for AMT purposes. A private activity bond is a state or local bond issued to
provide funds for private, nongovernmental activities such as building a
sports stadium, industrial development, student loan financing, or low-
income housing. These bonds are often issued by states, counties or cities
and are tax-exempt for regular federal tax, but not for the AMT. If you
invest in mutual funds, the 1099 you get will list how much interest you
received from private activity bonds. This amount is entered on Line 12 to
show the income as taxable for AMT purposes.
Suggestion: If you are subject to the AMT, invest in tax-exempt bonds issued
before 2009 that are not private activity bonds. Many mutual fund companies
have two listings of state bond funds, one that contains private activity
bonds, and one that doesn't. Read the literature carefully.
Line 13: Section 1202 Exclusion: You can exclude from your income some
portion of the gain on the sale of qualified small business stock held more
than five years. The gain on the sale of this stock is 50 percent excludable
for regular tax purposes, but 7 percent of the excluded gain is added back
for AMT purposes.
Suggestion: In the year that you sell qualified small business stock, try to
eliminate or reduce as many other AMT adjustments as possible to get the
maximum gain exclusion on the sale of the stock.
Line 14: Incentive Stock Options: This line is another common problem for
people affected by the AMT. If you exercise an Incentive Stock Option (ISO)
but do not sell the stock in the year of exercise, the transaction is not
taxable that year for regular tax purposes.
However, the difference between the exercise price and the fair market value
of the stock on the day of the exercise is an adjustment for AMT purposes
and appears on Line 15. For many people, this adjustment can be a very large
number. Essentially, you are going to be taxed on a hypothetical profit (
what you might have made if you sold the stock on the day you bought it.)
Example:
You exercise Incentive Stock Options (ISOs) to purchase 100 shares of stock
at $3 per share and you decide to hold the stock as a long-term investment.
The stock is trading at $33 per share on the day of the exercise. Line 15 on
your Form 6251 is $3000 (100 shares x ($33-$3 per share).
Your basis in this stock is now $300 ($3 x 100) for regular tax purposes,
but $3300 ($33 x 100) for AMT purposes. When you later sell the stock, you
will have an entry on Line 18, Disposition of Property Difference, to
account for the difference in your tax basis for regular and AMT purposes.
Suggestion 1: If you exercise ISOs as in the previous example at $33 and the
stock falls before the end of the current year, you can sell the stock and
avoid the AMT. If the stock fell to $25 during the year of the exercise, you
would be subject to regular tax on only $22 per share ($25-$3) and not be
subject to the AMT adjustment at all.
Suggestion 2: When you exercise ISOs, always use tax planning software to
forecast the tax consequences. You may need to sell some of the stock in the
year of the exercise to pay the tax due.
Line 15: Estates or Trusts: This line contains differences between AMT and
regular tax deductions from estates or trusts. Unfortunately, decisions by
the administrators of the estate or trust may be beyond your control.
Line 16: Electing Large Partnerships: An entry on this line comes from a
partnership in which you are a partner. Other than disposing of the
investment, which would have other tax ramifications, there is probably
nothing you can do about an entry on this line.
Line 17: Disposition of Property Difference: The tax basis in assets that
you sold may be different for regular and AMT purposes depending on the
depreciation method you chose (see Line 19), or on your incentive stock
options (see Line 15).
Line 18: Post-1986 Depreciation: On this line, you enter the depreciation
difference for regular and AMT purposes. For AMT purposes, you generally
must depreciate (deduct) business assets over a longer period of time than
you can for regular tax purposes. This creates a difference between regular
tax depreciation and AMT depreciation. This is an entry that does self-
correct. By the time the asset is completely written off, you have received
the same deduction for both regular and AMT purposes.
Suggestion: If you have an entry on this line, consider electing a slower
depreciation method for your business assets, which could eliminate the AMT
adjustment.
Line 19: Passive Activities: This line contains the differences between AMT
and regular tax deductions for passive activities. This line usually relates
to a difference in depreciation methods for rentals, partnerships or S
Corporations.
Suggestion: If the adjustment is from a rental property, consider using
slower depreciation methods for regular tax purposes to eliminate an entry
on this line. If the adjustment is from a partnership or S Corporation, the
depreciation methods are selected at the entity level and there is probably
nothing you can do.
Line 20: Loss Limitations: You may have AMT or regular tax differences due
to passive investments in partnerships or S Corporations. Depending on your
percentage of ownership, you may discuss with the management of these
investments any items that are generating AMT on your tax return to see if
the AMT impact can be lessened in future years.
Line 21: Circulation Expenditures: This line relates to the difference
between how newspaper or magazine circulation expenditures are deducted
under both tax systems.
Suggestion: If you have an entry on this line, consider making an election
under Internal Revenue Code (IRC) section 59(e) to amortize these expenses
over three years for regular tax purposes. This will eliminate the entry on
this line for AMT purposes.
Line 22: Long-Term Contracts: Long-term construction contractors are
generally required to use the percentage of completion method of accounting
for long-term contract revenue, rather than the completed-contract method.
This is a timing difference that will reverse in later years.
Line 23: Mining Costs: Mining exploration and development costs may also
generate an AMT adjustment unless you make an IRC section 59(e) election to
write-off the costs over 10 years. Making the election eliminates an entry
on this line.
Line 24: Research and Experimental Expenditures: This adjustment is related
to a timing difference between deducting Research and Experimental
Expenditures for regular and AMT purposes. You can eliminate this line entry
if you make the IRC section 59(e) election to deduct the costs over 10
years.
Line 25: Installment Sales: Installment sales of inventory items are not
allowed for AMT purposes for sales entered into between August 16, 1986 and
January 1, 1987. (Almost no one uses this line).
Line 26: Intangible Drilling Costs: This line relates to the difference in
timing of the deductions for intangible drilling costs. You can make an
election under IRC section 59(e) to write off intangible drilling costs over
60 months for regular tax purposes, and eliminate an entry on this line.
Line 27: Other Adjustments: This line relates to any other income or
deduction items that are affected by AMT differences, such as taxable IRA
distributions, self-employed health insurance, IRA deductions and other
income-based calculations.
Having thrown so many items back into your income, you now get a small break
. Your taxable income for AMT purposes is reduced by an exemption amount,
which depends on your income and filing status. For 2010, the exemption
amount for married couples filing jointly is $72,450 and $47,450 for
individuals and heads of household. This exemption amount phases out as
income increases.
Now you calculate the Tentative Minimum Tax (Line 34). You compare this
figure to the tax you calculated under the regular tax system on Form 1040.
The difference is the Alternative Minimum Tax.
You pay the Tentative Minimum Tax or the regular tax, whichever is higher.
What happens to my tax credits?
If the calculation on Form 6251: Alternative Minimum Tax shows that your
Tentative Minimum Tax is less than your regular tax, you don't owe any AMT,
but you may still be affected by the AMT in other ways.
Business credits
Because of the AMT, you may not be receiving all of your tax credits such as
the Low-Income Housing or Work Opportunity Credits.
Your Tentative Minimum Tax limits these credits and most other general
business credits other than the energy credit, because these credits cannot
reduce the tax you pay below the Tentative Minimum Tax.
•If you have any of these credits, usually from a business entity or
an investment, you should analyze Lines 2-28 of Form 6251 to see what you
can do to reduce your Tentative Minimum Tax and allow more credits.
•Any general business credit not allowed may be carried back 2 years
and carried forward 20 years.
Credit for paying the AMT
You get a tax credit for Alternative Minimum Tax paid in a prior year.
This credit, calculated on Form 8801: Credit for Prior Year Minimum Tax
calculates how much of the AMT was related to deferral items, which generate
credit for future years, as opposed to exclusion items which are not
deductible for AMT, and consequently are lost.
Certain items in Lines 2-28 of the Form 6251 are simply not deductible for
AMT purposes, such as taxes, home equity mortgage interest and miscellaneous
deductions. Lines 2-5, 8-10, 13 and 14 are exclusion items. If you paid AMT
based on entries on these lines, you will not receive a tax credit for AMT.
Other items create timing differences, such as depreciation differences
between the two tax systems, and the phantom income from exercising
incentive stock options. These items will generate a credit on Form 8801 and
reduce your taxes in future years.
Lines 15-28 are deferral items. An AMT credit may be generated based on the
reversal of the timing difference of these items. For example, AMT
depreciation methods may be slower than those for the regular tax, but you
will eventually receive the same deduction. To calculate and report your AMT
credit you need to fill out Form 8801: Credit for Prior Year Minimum Tax.
As part of the 2008 financial rescue law, Congress OK’d major relief for
taxpayers who incurred large AMT tax credit carried forward due to the
exercise of incentive stock options before the tech stock crash in 2000 and
2001. All tax, penalties and interest due on outstanding alternative minimum
tax liabilities resulting from exercising incentive stock options will be
abated. This will put a halt to IRS collection activities. Anyone who is
still using up minimum tax credits from AMT paid in 2003 or before can burn
them off through 2009, no matter how high their income is. Prior law limited
this relief for single filers with adjusted gross incomes above $156,400
and married filers with AGIs above $234,600. In addition, these credits are
refundable.
【在 l****n 的大作中提到】
: 又到报税的季节了，我在网上研究AMT，研究得头大如斗。 没啥头绪。
: 有哪位大侠，达人方便解答一下吗？
: AMT是指如果itemized deduction如果太多 就会trigger AMT是吗？ 而ATM 的税率比普
: 通的高，
: 是吗？ AMT跟收入有没有关系？ 有没有什么办法避免AMT的发生？
: 多谢！
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