In 2017, Liam's filing status is married filing separately. For regular tax purposes, he claims a dependency exemption for himself and three personal exemptions ($16,200 in total). Liam does not itemize deductions; his regular taxable income is $56,000.

What is Liam's 2017 AMT base?
A)$20,100.
B)$36,300.
C)$42,250.
D)$78,550.

Question

​In 2017, Liam's filing status is married filing separately. For regular tax purposes, he claims a dependency exemption for himself and three personal exemptions ($16,200 in total). Liam does not itemize deductions; his regular taxable income is $56,000. ​
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What is Liam's 2017 AMT base?
A)​$20,100.
B)​$36,300.
C)​$42,250.
D)​$78,550.

Quizplus · Accepted Answer

To calculate the AMT base, we need to start with regular taxable income ($56,000) and add back any AMT adjustments. The most common AMT adjustment for individuals is the personal exemption phaseout, which reduces the amount of exemptions a taxpayer can claim as income rises. For 2017, the phaseout begins at $261,500 for married taxpayers filing separately (as Liam is) and completely phases out at $384,000. Liam's income of $56,000 is well below the phaseout range, so he can claim all three personal exemptions for a total adjustment of $16,200. Thus, Liam's AMT base is $72,200 ($56,000 + $16,200). However, the AMT exemption amount for 2017 is $54,300 for married filing separately, which we need to subtract from the AMT base to determine Liam's final AMT liability. The result is $17,900, but we don't need to calculate that figure to answer this question. The question only asks for Liam's AMT base, which is $72,200. Therefore, the correct answer is B.

​In 2017, Liam's Filing Status Is Married Filing Separately

In 2017, Liam's Filing Status Is Married Filing Separately