Mr.and Mrs.Luang reported $1,417,900 ordinary taxable income for regular tax purposes and had $139,100 positive AMT adjustments and preferences.Compute their tentative minimum tax.

Question

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The tentative minimum tax is calculated by applying the AMT rates to the AMT income, which is the sum of ordinary taxable income and AMT adjustments. The AMT exemption is subtracted from this sum before applying the rates. The AMT rates are 26% on the first $199,900 (for married filing jointly) and 28% on the excess. Calculating this gives $432,064.

MrAnd MrsLuang Reported $1,417,900 Ordinary Taxable Income for Regular Tax Purposes