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    I:14-45 AMT Adjustments and Computation of Tax liability

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    I:14-45 AMT Adjustments and Computation of Tax. Allen, a single taxpayer, reports the following items on his 2007 federal income tax return:

    Adjusted gross income $75,000
    Taxable income 48,000
    Regular tax liability 8,424
    Tax preferences 20,000
    Itemized deductions including:
    Charitable contributions 7,500
    Medical expenses (before AGI floor) 10,000
    Mortgage interest on personal residence 10,000
    State income taxes 5,000
    Real estate taxes 8,000


    a. What is the amount of Allen's AMT adjustments related to the itemized deductions?
    b. What is Allen's AMT liability for the current year?

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    Solution Preview

    Referring to a Form 6251 for 2007, the following amounts would be entered:

    Line 1 $40,125
    Line 2 1,875
    Line 3 13,000

    Line ...

    Solution Summary

    The solution gives the answers for amounts to be entered on specific lines of the Form 6151 for 2007 for Allen. Following are the explanations for amounts on each line.