Ashby, who is single and age 30, provides you with the following information from his financial records for 2019. $$\begin{array} { l l }
\text { Regular income tax liability } & \$ 78,444 \
\text { AMTI } & 525,000 \
\text { Taxable income } & 295,000
\end{array}$$ Calculate his AMT exemption for 2019.
A)$0
B)$3,675
C)$68,025
D)$71,700

Question

Ashby, who is single and age 30, provides you with the following information from his financial records for 2019. $$\begin{array} { l l } 
\text { Regular income tax liability } & \$ 78,444 \
\text { AMTI } & 525,000 \
\text { Taxable income } & 295,000
\end{array}$$ Calculate his AMT exemption for 2019.
A)$0
B)$3,675
C)$68,025
D)$71,700

Quizplus · Accepted Answer

For 2019, the AMT exemption amount for a single filer was $71,700. However, this exemption begins to phase out at $510,300 of AMTI for single filers. Ashby's AMTI is $525,000, which is $14,700 over the phase-out threshold. The phase-out rate is 25%, so the reduction in his exemption is $14,700 * 25% = $3,675. Therefore, his AMT exemption is $71,700 - $3,675 = $68,025.

Ashby, Who Is Single and Age 30, Provides You with the Following