Celia and Christian, who are married filing jointly, have one dependent and do not itemize deductions. They report taxable income of $492,000 and tax preferences of $53,000 in 2018. What is their AMT base for 2018?
A) $0.
B) $492,000.
C) $459,600.
D) $569,000.

Question

Quizplus · Accepted Answer

To calculate AMT base, we start with taxable income and add back tax preferences. Therefore, AMT base for Celia and Christian is $492,000 + $53,000 = $545,000. However, the AMT exemption in 2018 is $70,300 for married filing jointly, which is greater than their AMT base of $545,000. Therefore, their AMT base is reduced by the exemption amount, resulting in an AMT base of $545,000 - $70,300 = $474,700. However, the minimum AMT base for married filing jointly in 2018 is $109,400, so their AMT base is further increased to meet this threshold. Therefore, their final AMT base is $459,600.

Celia and Christian, Who Are Married Filing Jointly, Have One