Income tax- Alternative minimum tax

question:

Ivan grandfather died and left a portfolio of municipal bonds. In 2016, they pay Ivan $80.000 in tax-free interest. Since the bonds are private activity bonds, the $80,000 is a tax preference for purposes of the AMT. Assume the Ivan's federal income tax withholding from his wages is $12,000. How to enter it in Form 6251.

This problem requires the calculation of AMT. The home equity interest of $900 on the purchse of an automobile is not deductible for AMT (see line 4 of form 6251). Please also note that page 2 of form 6251 must be filled to calculate the lower AMT amount on qualified dividends and that the Savers Credit still applies.

PLEASE I NEED THIS AS SOON AS POSSIBLE. IF IS POSSIBLE FOR TONIGHT. THANK YOU

Form 6251 Department of the Treasury Internal Revenue Service (99) Alternative Minimum TaxIndividuals Information OMB No. 1545-0074 Attachment Sequence No. 32 Your social security number Name(s) shown on Form 1040 or Form 1040NR Part I 2016 about Form 6251 and its separate instructions is at www.irs.gov/form6251. Attach to Form 1040 or Form 1040NR. Alternative Minimum Taxable Income (See instructions for how to complete each line.) 1 If filing Schedule A (Form 1040), enter the amount from Form 1040, line 41, and go to line 2. Otherwise, enter the amount from Form 1040, line 38, and go to line 7. (If less than zero, enter as a negative amount.) 1 2 Medical and dental. If you or your spouse was 65 or older, enter the smaller of Schedule A (Form 1040), line 4, or 2.5% (0.025) of Form 1040, line 38. If zero or less, enter -0- . . . . . . . . . . . . 3 Taxes from Schedule A (Form 1040), line 9 . . . . . . . . . . . . . . . . . . . . 4 Enter the home mortgage interest adjustment, if any, from line 6 of the worksheet in the instructions for this line 5 Miscellaneous deductions from Schedule A (Form 1040), line 27. . . . . . . . . . . . . . 6 If Form 1040, line 38, is $155,650 or less, enter -0-. Otherwise, see instructions . . . . . . . . . 7 Tax refund from Form 1040, line 10 or line 21 . . . . . . . . . . . . . . . . . . . 8 Investment interest expense (difference between regular tax and AMT). . . . . . . . . . . . 9 Depletion (difference between regular tax and AMT) . . . . . . . . . . . . . . . . . 10 Net operating loss deduction from Form 1040, line 21. Enter as a positive amount . . . . . . . . 11 Alternative tax net operating loss deduction . . . . . . . . . . . . . . . . . . . . 12 Interest from specified private activity bonds exempt from the regular tax . . . . . . . . . . 13 Qualified small business stock, see instructions . . . . . . . . . . . . . . . . . . . 14 Exercise of incentive stock options (excess of AMT income over regular tax income) . . . . . . . . 15 Estates and trusts (amount from Schedule K-1 (Form 1041), box 12, code A) . . . . . . . . . 16 Electing large partnerships (amount from Schedule K-1 (Form 1065-B), box 6) . . . . . . . . . 17 Disposition of property (difference between AMT and regular tax gain or loss) . . . . . . . . . 18 Depreciation on assets placed in service after 1986 (difference between regular tax and AMT) . . . . 19 Passive activities (difference between AMT and regular tax income or loss) . . . . . . . . . . 20 Loss limitations (difference between AMT and regular tax income or loss) . . . . . . . . . . . 21 Circulation costs (difference between regular tax and AMT) . . . . . . . . . . . . . . . 22 Long-term contracts (difference between AMT and regular tax income) . . . . . . . . . . . 23 Mining costs (difference between regular tax and AMT) . . . . . . . . . . . . . . . . 24 Research and experimental costs (difference between regular tax and AMT) . . . . . . . . . . 25 Income from certain installment sales before January 1, 1987 . . . . . . . . . . . . . . 26 Intangible drilling costs preference . . . . . . . . . . . . . . . . . . . . . . . 27 Other adjustments, including income-based related adjustments . . . . . . . . . . . . . 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Alternative minimum taxable income. Combine lines 1 through 27. (If married filing separately and line 28 is more than $247,450, see instructions.) . . . . . . . . . . . . . . . . . . . . 28 ( ( ) ) ( ) ( ) Part II Alternative Minimum Tax (AMT) 29 Exemption. (If you were under age 24 at the end of 2016, see instructions.) IF your filing status is . . . AND line 28 is not over . . . THEN enter on line 29 . . . Single or head of household . . . . $119,700 . . . . . $53,900 Married filing jointly or qualifying widow(er) 159,700 . . . . . 83,800 Married filing separately . . . . . . 79,850 . . . . . 41,900 If line 28 is over the amount shown above for your filing status, see instructions. } . . 29 30 Subtract line 29 from line 28. If more than zero, go to line 31. If zero or less, enter -0- here and on lines 31, 33, and 35, and go to line 34 . . . . . . . . . . . . . . . . . . . . . . 31 If you are filing Form 2555 or 2555-EZ, see instructions for the amount to enter. } . . . 30 . . . 31 . . . . . . . . 32 33 . If you reported capital gain distributions directly on Form 1040, line 13; you reported qualified dividends on Form 1040, line 9b; or you had a gain on both lines 15 and 16 of Schedule D (Form 1040) (as refigured for the AMT, if necessary), complete Part III on the back and enter the amount from line 64 here. All others: If line 30 is $186,300 or less ($93,150 or less if married filing separately), multiply line 30 by 26% (0.26). Otherwise, multiply line 30 by 28% (0.28) and subtract $3,726 ($1,863 if married filing separately) from the result. 32 Alternative minimum tax foreign tax credit (see instructions) . 33 Tentative minimum tax. Subtract line 32 from line 31 . . . . . . . . . . . . . . . . . . . . . . . . . 34 Add Form 1040, line 44 (minus any tax from Form 4972), and Form 1040, line 46. Subtract from the result any foreign tax credit from Form 1040, line 48. If you used Schedule J to figure your tax on Form 1040, line 44, refigure that tax without using Schedule J before completing this line (see instructions) . . . . . . . . 35 AMT. Subtract line 34 from line 33. If zero or less, enter -0-. Enter here and on Form 1040, line 45 . . . . . For Paperwork Reduction Act Notice, see your tax return instructions. Cat. No. 13600G 34 35 Form 6251 (2016) Form 6251 (2016) Page 2 Part III Tax Computation Using Maximum Capital Gains Rates Complete Part III only if you are required to do so by line 31 or by the Foreign Earned Income Tax Worksheet in the instructions. 36 Enter the amount from Form 6251, line 30. If you are filing Form 2555 or 2555-EZ, enter the amount from line 3 of the worksheet in the instructions for line 31 . . . . . . . . . . . . . . . . . 36 37 Enter the amount from line 6 of the Qualified Dividends and Capital Gain Tax Worksheet in the instructions for Form 1040, line 44, or the amount from line 13 of the Schedule D Tax Worksheet in the instructions for Schedule D (Form 1040), whichever applies (as refigured for the AMT, if necessary) (see instructions). If you are filing Form 2555 or 2555-EZ, see instructions for the amount to enter . . . . . . . . . 37 38 Enter the amount from Schedule D (Form 1040), line 19 (as refigured for the AMT, if necessary) (see instructions). If you are filing Form 2555 or 2555-EZ, see instructions for the amount to enter . . . . . 38 39 If you did not complete a Schedule D Tax Worksheet for the regular tax or the AMT, enter the amount from line 37. Otherwise, add lines 37 and 38, and enter the smaller of that result or the amount from line 10 of the Schedule D Tax Worksheet (as refigured for the AMT, if necessary). If you are filing Form 2555 or 2555-EZ, see instructions for the amount to enter . . . . . . . . . . . . . . . . . . 40 Enter the smaller of line 36 or line 39 . . . . . . . . . . . . . . . . . . . . . . 41 Subtract line 40 from line 36 . . . . . . . . . . . . . . . . . . . . . . . . . 39 40 41 42 If line 41 is $186,300 or less ($93,150 or less if married filing separately), multiply line 41 by 26% (0.26). Otherwise, multiply line 41 by 28% (0.28) and subtract $3,726 ($1,863 if married filing separately) from the result . . . 43 Enter: $75,300 if married filing jointly or qualifying widow(er), $37,650 if single or married filing separately, or . . . . . . . $50,400 if head of household. } 44 Enter the amount from line 7 of the Qualified Dividends and Capital Gain Tax Worksheet in the instructions for Form 1040, line 44, or the amount from line 14 of the Schedule D Tax Worksheet in the instructions for Schedule D (Form 1040), whichever applies (as figured for the regular tax). If you did not complete either worksheet for the regular tax, enter the amount from Form 1040, line 43; if zero or less, enter -0-. If you are filing Form 2555 or 2555-EZ, see instructions for the amount to enter . . . . . . . . . . . 45 Subtract line 44 from line 43. If zero or less, enter -0- . . . . . . . . . . . . . . . . . 46 Enter the smaller of line 36 or line 37 . . . . . . . . . . . . . . . . . . . . . . 47 Enter the smaller of line 45 or line 46. This amount is taxed at 0% . . . . . . . . . . . . . 48 Subtract line 47 from line 46 . . . . . . . . . . . . . . . . . . . . . . . . . 49 Enter: $415,050 if single . . . . . . . $233,475 if married filing separately $466,950 if married filing jointly or qualifying widow(er) $441,000 if head of household 50 Enter the amount from line 45 . . . . . . . . . . . . . . . . . . . . . . . . } 51 Enter the amount from line 7 of the Qualified Dividends and Capital Gain Tax Worksheet in the instructions for Form 1040, line 44, or the amount from line 19 of the Schedule D Tax Worksheet, whichever applies (as figured for the regular tax). If you did not complete either worksheet for the regular tax, enter the amount from Form 1040, line 43; if zero or less, enter -0-. If you are filing Form 2555 or Form 2555-EZ, see instructions for the amount to enter . . . . . . . . . . . . . . . . . . . . . 52 Add line 50 and line 51 . . . . . . . . . . . . . . . . . . . . . . . . . . 53 Subtract line 52 from line 49. If zero or less, enter -0- . . . . . . . . . . . . . . . . . 54 Enter the smaller of line 48 or line 53 . . . . . . . . . . . . . . . . . . . . . . 55 Multiply line 54 by 15% (0.15) . . . . . . . . . . . . . . . . . . . . . . . 56 Add lines 47 and 54 . . . . . . . . . . . . . . . . . . . . . . . . . . . If lines 56 and 36 are the same, skip lines 57 through 61 and go to line 62. Otherwise, go to line 57. 57 Subtract line 56 from line 46 . . . . . . . . . . . . . . . . . . . . . . . . . 58 Multiply line 57 by 20% (0.20) . . . . . . . . . . . . . . . . . . . . . . . If line 38 is zero or blank, skip lines 59 through 61 and go to line 62. Otherwise, go to line 59. 59 Add lines 41, 56, and 57 . . . . . . . . . . . . . . . . . . . . . . . . . 60 Subtract line 59 from line 36 . . . . . . . . . . . . . . . . . . . . . . . . 61 Multiply line 60 by 25% (0.25) . . . . . . . . . . . . . . . . . . . . . . . 62 Add lines 42, 55, 58, and 61 . . . . . . . . . . . . . . . . . . . . . . . . 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 If line 36 is $186,300 or less ($93,150 or less if married filing separately), multiply line 36 by 26% (0.26). Otherwise, multiply line 36 by 28% (0.28) and subtract $3,726 ($1,863 if married filing separately) from the result 63 64 Enter the smaller of line 62 or line 63 here and on line 31. If you are filing Form 2555 or 2555-EZ, do not enter this amount on line 31. Instead, enter it on line 4 of the worksheet in the instructions for line 31 . . 64 Form 6251 (2016)