What is an AMT exemption and do calculate the exemption amount?
Once the taxpayer has calculated their alternative minimum taxable income (AMTI), the taxpayer can assess whether they have any AMT exemptions. The AMT exemption reduces the taxpayers AMTI down to the alternative minimum tax base. There are also certain phase-out thresholds applicable to AMTI.
For 2020, the AMT phase-out thresholds and exceptions are as follows:
The visual below shows an example on how to calculate the AMT exemption for Jaxson!
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