Rosita Flores, who is single and age 56, had financial information for 2018 as follows: Taxable income (prior to the standard deduction), $540,000. Positive AMT adjustments, $60,000. AMT preferences,...

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Rosita Flores, who is single and age 56, had financial information for 2018 as follows: Taxable income (prior to the standard deduction), $540,000. Positive AMT adjustments, $60,000. AMT preferences,...

Rosita Flores, who is single and age 56, had financial information for 2018 as follows:

Taxable income (prior to the standard deduction), $540,000.
Positive AMT adjustments, $60,000.
AMT preferences, $30,000.
Negative AMT adjustments, $10,000.
State income taxes, $8,000.
Real estate taxes, $7,500.
Home mortgage (80% for qualified housing), $25,000.
Investment interest, $2,500.
Contributions (cash), $7,500.

Compute Rosita’s AMT base for 2018.

business accounting

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Answer 1

Answer #1

Computation of Rosita AMT base for 2018

Taxable Income : $540000

Add:Positive AMT adjustment : $60000

Less:Negative AMT adjustment ; $10000

Add: AMT preferences : $8000

Less: State Tax & Real estate Tax : $12000

(maximum deduction $12000 for single)

Less: Home mortgage (80%) : $20000

Less: Interest on Investment : $2500

Gross Base for AMT : $563500

LESS: Standard Deduction : $70300

AMT BASE FOR 2018 : $493200

NOTE: State Tax and Property Tax 12000 allowed as deduction for single

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Answer 2

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Rosita Flores, who is single and age 56, had financial information for 2018 as follows: Taxable income (prior to the standard deduction), $540,000. Positive AMT adjustments, $60,000. AMT preferences,...