Urban Corporation receives tax-exempt income from Denver municipal bonds. All the proceeds from the bonds were used to fund public projects. In computing its AMT base, Urban must add back the interest income from its municipal bonds to taxable income.

Question

Quizplus · Accepted Answer

Only tax-exempt interest from a private activity bond is potentially a preference item for corporate AMT purposes (depends on the year issued).

Urban Corporation Receives Tax-Exempt Income from Denver Municipal Bonds