Celia and Christian, who are married filing jointly, have one dependent and do not itemize deductions. They have taxable income of $82,000 and tax preferences of $53,000 in 2014. What is their AMT base for 2014?
A) $0.
B) $77,838.
C) $94,450.
D) $150,250.
E) None of the above.

Question

Quizplus · Accepted Answer

AMT base is taxable income plus tax preferences. So, Celia and Christian's AMT base is $82,000 + $53,000 = $135,000. However, the AMT base is phased out for taxpayers with high incomes. For 2014, the phase-out begins at $150,000 for married couples filing jointly. So, Celia and Christian's AMT base is reduced by $15,550, which is the amount by which their AMT base exceeds $150,000. This leaves them with an AMT base of $135,000 - $15,550 = $119,450. However, the AMT base cannot be less than zero. So, Celia and Christian's AMT base is $0.

Celia and Christian, Who Are Married Filing Jointly, Have One