Which of the following statements is correct?
A)If the tentative minimum tax is $10,000 and the regular income tax liability is $12,000, AMT is $2,000.
B)If the tentative minimum tax is $12,000 and the regular income tax liability is $10,000, AMT is $12,000.
C)If the tentative minimum tax is $10,000 and the regular income tax liability is $12,000, AMT is a negative $2,000.
D)If the tentative minimum tax is $12,000, and the regular income tax liability is $10,000, AMT is $2,000.

Question

Quizplus · Accepted Answer

The AMT is the difference between the tentative minimum tax and the regular income tax liability, whichever is higher. 
In this case, the tentative minimum tax is $12,000 and the regular income tax liability is $10,000. So, the AMT is $2,000 ($12,000 - $10,000 = $2,000). Therefore, option D is correct.

Which of the Following Statements Is Correct