Phaseout Status Exemption Begins at Ends at Married, joint $114,600 $1,047,200 $1,505,600 Single or head of household 73,600 523,600 818,000 Married, separate 57,300 523,600 752,800 Arthur Wesson, an unmarried individual who is age 58, reports taxable income of $510,000 in 2021. He reports positive AMT adjustments of $80,000 and preferences of $35,000. Arthur itemizes his deductions, and his regular tax liability in 2021 is $153,044. Click here to access the exemption table. a. Arthur's initial AMT exemption amount for 2021 is $ 72,900 X, since his filing status is single. However, the exemption is 518,400 X. Therefore, Arthur's total AMT phased out at a rate of 25 cents on the dollar when AMTI exceeds $ exemption will be $ 46,250 X. A graduated, two-tier AMT rate schedule applies to individual taxpayers. A 26% base, and a 28% rate applies to the first $199,900 of the AMT rate applies to the AMT base in excess of $199,900. Compute Arthur's AMT for 2021. Arthur's taxable income (before personal exemption) 510,000 Plus: Positive AMT adjustments Plus: Tax preferences Equals: AMTI Less: Exemption Equals: AMT base Tentative AMT Regular income tax liability AMT b. What is the total amount of Arthur's tax liability? 158,092 X 80,000 35,000 625,000 46,250 X 578,750 158,092 X $153,044 4,797 c. Complete the e-mail explaining to Arthur why he must pay tax in excess of the regular tax liability. From: Samantha Ash (SAsh@swft.com) Sent: February 4, 2022 To: Arthur Wesson (AWesson@FederalWest.com) Subject: 2021 income tax liability Dear Mr. Wesson: We have calculated your total Federal tax liability for 2021 to be $ $153,044 and the alternative minimum tax (AMT) liability of $ 158,092 X. This consists of the regular tax liability of 4,797 x.