Question 1. How can an AMT adjustment be avoided for a taxpayer w

1. How can an AMT adjustment be avoided for a taxpayer who incurs circulation expenditures in the current tax year?

2. In determining the amount of the AMT adjustments, discuss the difference in the treatment of a building placed in service after 1986 and before January 1, 1999 and a building placed in service after December 31, 1998.

3. How can the positive AMT adjustment for research and experimental expenditures be avoided?

4. Durell owns a construction company that builds residential housing. The company is eligible to use the completed contract method for regular income tax purposes. What can Durell do to minimize his AMT?

5. Discuss the tax year in which an AMT adjustment is first required for an ISO.

6. If Jessica exercises an ISO and disposes of the option in the same tax year, are any AMT adjustments required?

7. Danica owned a car that she used exclusively for business. The car was purchased in 2010 and sold in 2014 for a recognized gain of $9,000. However, the sale resulted in no AMT. Why?

8. A taxpayer has a passive activity loss for the current tax year for regular income tax purposes and for AMT purposes. Is it possible that the passive activity losses will be the same amount?

9. What itemized deductions are allowed for both regular income tax purposes and for AMT purposes?

10. What effect do deductible gambling losses for regular income tax purposes have in calculating AMTI?

11. Why is there no AMT adjustment for charitable contributions?

12. Is it possible that no AMT adjustment is necessary for medical expenses in calculating AMTI for a taxpayer who is at least age 65 even though the floor limitation is different (7.5% of AGI for regular income tax compared to 10% for AMT purposes)?

13. When qualified residence interest exceeds qualified housing interest, the positive adjustment required in calculating AMT is a timing adjustment. That is, in the future, there will be an offsetting negative adjustment. Comment on the validity of this statement.

14. Andrea, who is single, has a personal exemption deduction in calculating her 2014 taxable income. She has no dependency deductions. What is the amount of the AMT adjustment in calculating AMTI?

15. How can interest on a private activity bond issued in 2008 result in both an AMT adjustment that decreases AMTI and an AMT preference that increases AMTI?

16. If a taxpayer deducts the standard deduction in calculating regular taxable income, what effect does this have in calculating AMTI?

17. Identify an AMT adjustment that applies for the individual taxpayer that does not apply for the corporate taxpayer and identify an AMT adjustment that applies for the corporate taxpayer that does not apply for the individual taxpayer.

18. Are the AMT rates for the individual taxpayer the same as those for a corporate taxpayer?

19. Under what circumstances are corporations exempt from the AMT?

20. For the ACE adjustment, discuss the relationship between ACE and unadjusted AMTI.