Kelly purchases a warehouse for her sole proprietorship on January 5,2016 for $1,000,000.She claims MACRS depreciation of $25,641 for the year.The depreciation under the Alternative Depreciation System (ADS)is $25,000.What is the amount of Kelly's AMT adjustment for depreciation on the warehouse?

Question

Quizplus · Accepted Answer

The AMT adjustment is the difference between the MACRS depreciation and the ADS depreciation, which is $25,641 - $25,000 = $641. Since MACRS depreciation is higher, the adjustment is positive.

Kelly Purchases a Warehouse for Her Sole Proprietorship on January