Jackson sells qualifying small business stock for $125,000 (adjusted basis of $105,000) in 2014.In calculating gross income for regular income tax purposes,he excludes all of his realized gain of $20,000.The $20,000 exclusion is a tax preference in calculating Jackson's AMTI.

Question

Quizplus · Accepted Answer

Excluding realized gain from qualifying small business stock is a tax preference for calculating regular taxable income, but it is not a tax preference for calculating AMTI. Therefore, the $20,000 exclusion cannot be used as a tax preference in calculating Jackson's AMTI.

Jackson Sells Qualifying Small Business Stock for $125,000 (Adjusted Basis