Jackson sells qualifying small business stock for $125,000 (adjusted basis of $105,000) in 2019 (the stock was acquired in 2012).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 preference in calculating Jackson's AMTI.

Question

Quizplus · Accepted Answer

The exclusion of gain on the sale of qualifying small business stock under IRC Section 1202 is not considered a preference item for the purpose of calculating Alternative Minimum Taxable Income (AMTI).

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