Re: 2005 AMT Change Question



<KEBSCHULLW@xxxxxxx> wrote in message
news:1137287141.613856.107830@xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
>
> WD Kebschull wrote::
>> >
>> > How would the amount currently calculated for AMT using IRS
>> > instructions change if the phrase "paragraphs (1), (2), or (3) of
>> > section 164(a)" replaced "(A)(ii)" in section 56(b)(1)(D) of the IRC
>> > so that the section read as indicated below???
>
> Modified section 56(b)(1)(A)(ii)
>
> Treatment of certain recoveries
> No recovery of any tax to which paragraphs (1), (2), or (3) of section
> 164(a) applied shall be included in gross income for purposes of
> determining alternative minimum taxable income.

Your proposed modification is redundant and totally unnecesary as the
ENTIRER Section 56 concerns only the adjustments in the computatuion of AMTI
and that is the ENTIRE subject of the entire section.

SECTION 56. ADJUSTMENTS IN COMPUTING ALTERNATIVE
MINIMUM TAXABLE INCOME
(a) ADJUSTMENTS APPLICABLE TO ALL TAXPAYERS
In determining the amount of the alternative minimum taxable income for
any taxable year the following treatment shall apply (in lieu of the
treatment applicable for purposes of computing the regular tax):
.. . .
(b) ADJUSTMENTS APPLICABLE TO INDIVIDUALS
In determining the amount of the alternative minimum taxable income of any
taxpayer (other than a corporation), the following treatment shall apply
(in lieu of the treatment applicable for purposes of computing the regular
tax):
.. . .
(c) ADJUSTMENTS APPLICABLE TO CORPORATIONS
In determining the amount of the alternative minimum taxable income of a
corporation, the following treatment shall apply:
.. . .

>> Richard Macdonald responded:
>
>> (b) ADJUSTMENTS APPLICABLE TO INDIVIDUALS
>> In determining the amount of the alternative minimum taxable income of
>> any
>> taxpayer (other than a corporation), the following treatment shall apply
>> (in lieu of the treatment applicable for purposes of computing the
>> regular
>> tax):
>> (1) LIMITATION ON DEDUCTIONS
>> (A) IN GENERAL
>> No deduction shall be allowed--
>> (ii) for any taxes described in paragraph (1), (2), or (3) of
>> section
>> 164(a).
>>
>> Note - State Taxes are not allowed for the calculation of AMTI,
>> which is calculated EVERY YEAR since the AMT was enacted
>> regardless of whether AMT is paid in addition of regular tax.
>>
>> Ergo, the recapture of state taxes is not includable for AMTI in
>> ANY YEAR since the year after the AMT was enacted.

Just think of the ENTIRE section 56 as the "Gross Income" for the
AMT, it will ALWAYS be there even if you don't have to pay the tax.

So unless you can cite when the calaulation of AMTI is not done, it is done.


.



Relevant Pages

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