Problem 12-48 (LO. 2, 3, 4, 5) Lynn, age 45, is single and has no dependents. Her income and expenses for 2020 are reported as follows. Income Salary $233,000 Taxable interest on corporate bonds 13,700 Business income 64,000 Expenses Home office expense deduction (associated with sole proprietorship) 3,200 State income taxes 6,000 Real property taxes 8,500 Home mortgage (qualified housing) interest 9,200 Home equity loan interest 2,500 Investment interest 15,500 Cash contributions to various charities 2,900 The $64,000 business income is from Apex Office Supplies Company, a sole proprietorship that Lynn owns and operates. Apex claimed MACRS depreciation of $3,175 on personal property used in the business and placed in service in the current year. Lynn received interest of $30,000 on City of Pensacola private activity bonds that were issued in 2014. Based on the financial information presented above, compute Lynn's AMT for 2020. Ignore the one-half deduction for self-employment taxes for this problem. Click here to access the Tax Rate Schedules. Click here to access exemption tables. If an amount is zero, enter "0". Round your intermediate computations and final answers to nearest dollar. Gross income 307,500 Adjusted gross income 307,500 Less: deductions from AGI 35,800 271,700 Taxable income Regular income tax calculation Total tax Computation of alternative minimum tax Taxable income 271,700 Plus: positive adjustments and tax preferences 40,000 Less: negative adjustment 1,800 Alternative minimum taxable income 309,900 Less: AMT exemption 72,900 AMT base 237,000 TMT AMT 0 Status Married, joint Single or head of household Married, separate Exemption $113,400 72,900 56,700 Phaseout Begins at Ends at $1,036,800 $1,490,400 518,400 810,000 518,400 745,200 of the amount over- $ 0 2019 Tax Rate Schedules Single-Schedule X Head of household-Schedule Z If taxable of the If taxable income is: But not amount income is: But not Over- over- The tax is: over- Over- over- The tax is: $ 0 $ 9,700 ......... 10% $ 0 $ 0 $ 13,850 ......... 10% 9,700 39,475 $ 970.00 + 12% 9,700 13,850 52,850 $ 1,385.00 + 12% 39,475 84,200 4,543.00 + 22% 39,475 52,850 84,200 6,065.00 + 22% 84,200 160,725 14,382.50 + 24% 84,200 84,200 160,700 12,962.00 +24% 160,725 204,100 32,748.50 + 32% 160,725 160,700 204,100 31,322.00 + 32% 204,100 510,300 46,628.50 + 35% 204,100 204,100 510,300 45,210.00 + 35% 510,300 153,798.50 + 37% 510,300 510,300 152,380.00 + 37% Married filing jointly or Qualifying widow(er)- Married filing separatelySchedule Y-2 Schedule Y-1 If taxable of the If taxable income is: But not amount income is: But not Over- over- The tax is: over- Over- over- The tax is: $ 0 $ 19,400 ......... 10% $ 0 $ 0 $ 9,700 ......... 10% 19,400 78,950 $ 1,940.00 + 12% 19,400 9,700 39,475 $ 970.00 + 12% 78,950 168,400 9,086.00 + 22% 78,950 39,475 84,200 4,543.00 + 22% 168,400 321,450 28,765.00 + 24% 168,400 84,200 160,725 14,382.50 +24% 321,450 408,200 65,497.00+ 32% 321,450 160,725 204,100 32,748.50 + 32% 408,200 612,350 93,257.00 + 35% 408,200 204,100 306,175 46,628.50 + 35% 612,350 164,709.50 + 37% 612,350 306,175 82,354.75 + 37% 13,850 52,850 84,200 160,700 204,100 510,300 of the amount over $ 0 9,700 39,475 84,200 160,725 204,100 306, 175 of the amount over ......... 10% $ 0 14,100 53,700 2020 Tax Rate Schedules Single-Schedule Head of householdSchedule Z If taxable of the If taxable income is: But not amount income is: But not Over- over- The tax is: over- Over- over- The tax is: $ 0 $ 9,875 10% $ 0 $ 0 $ 14,100 9,875 40,125 $ 987.50 + 12% 9,875 14,100 53,700 $ 1,410.00 + 12% 40,125 85,525 4,617.50 + 22% 40,125 53,700 85,500 6,162.00 +22% 85,525 163,300 14,605.50 + 24% 85,525 85,500 163,300 13,158.00 +24% 163,300 207,350 33,271.50 + 32% 163,300 163,300 207,350 31,830.00 + 32% 207,350 518,400 47,367.50 + 35% 207,350 207,350 518,400 45,926.00 + 35% 518,400 156,235.00 + 37% 518,400 518,400 154,793.50 + 37% Married filing jointly or Qualifying widow(er)- Married filing separately-Schedule Y-2 Schedule Y-1 If taxable of the If taxable income is: But not amount income is: But not Over- over The tax is: over- Over- over- The tax is: $ 0 $ 19,750 $ 0 $ 0 $ 9,875 .........10% 19,750 80,250 $ 1,975.00 + 12% 19,750 9,875 40,125 $ 987.50 + 12% 80,250 171,050 9,235.00 + 22% 80,250 40,125 85,525 4,617.50 + 22% 171,050 326,600 29,211.00 + 24% 171,050 85,525 163,300 14,605.50 +24% 326,600 414,700 66,543.00 + 32% 326,600 163,300 207,350 33,271.50 + 32% 414,700 622,050 94,735.00 + 35% 414,700 207,350 311,025 47,367.50 + 35% 622,050 167,307.50 + 37% 622,050 311,025 83,653.75 + 37% 85,500 163,300 207,350 518,400 of the amount over- $ 0 ......... 10% 9,875 40,125 85,525 163,300 207,350 311,025 Problem 12-48 (LO. 2, 3, 4, 5) Lynn, age 45, is single and has no dependents. Her income and expenses for 2020 are reported as follows. Income Salary $233,000 Taxable interest on corporate bonds 13,700 Business income 64,000 Expenses Home office expense deduction (associated with sole proprietorship) 3,200 State income taxes 6,000 Real property taxes 8,500 Home mortgage (qualified housing) interest 9,200 Home equity loan interest 2,500 Investment interest 15,500 Cash contributions to various charities 2,900 The $64,000 business income is from Apex Office Supplies Company, a sole proprietorship that Lynn owns and operates. Apex claimed MACRS depreciation of $3,175 on personal property used in the business and placed in service in the current year. Lynn received interest of $30,000 on City of Pensacola private activity bonds that were issued in 2014. Based on the financial information presented above, compute Lynn's AMT for 2020. Ignore the one-half deduction for self-employment taxes for this problem. Click here to access the Tax Rate Schedules. Click here to access exemption tables. If an amount is zero, enter "0". Round your intermediate computations and final answers to nearest dollar. Gross income 307,500 Adjusted gross income 307,500 Less: deductions from AGI 35,800 271,700 Taxable income Regular income tax calculation Total tax Computation of alternative minimum tax Taxable income 271,700 Plus: positive adjustments and tax preferences 40,000 Less: negative adjustment 1,800 Alternative minimum taxable income 309,900 Less: AMT exemption 72,900 AMT base 237,000 TMT AMT 0 Status Married, joint Single or head of household Married, separate Exemption $113,400 72,900 56,700 Phaseout Begins at Ends at $1,036,800 $1,490,400 518,400 810,000 518,400 745,200 of the amount over- $ 0 2019 Tax Rate Schedules Single-Schedule X Head of household-Schedule Z If taxable of the If taxable income is: But not amount income is: But not Over- over- The tax is: over- Over- over- The tax is: $ 0 $ 9,700 ......... 10% $ 0 $ 0 $ 13,850 ......... 10% 9,700 39,475 $ 970.00 + 12% 9,700 13,850 52,850 $ 1,385.00 + 12% 39,475 84,200 4,543.00 + 22% 39,475 52,850 84,200 6,065.00 + 22% 84,200 160,725 14,382.50 + 24% 84,200 84,200 160,700 12,962.00 +24% 160,725 204,100 32,748.50 + 32% 160,725 160,700 204,100 31,322.00 + 32% 204,100 510,300 46,628.50 + 35% 204,100 204,100 510,300 45,210.00 + 35% 510,300 153,798.50 + 37% 510,300 510,300 152,380.00 + 37% Married filing jointly or Qualifying widow(er)- Married filing separatelySchedule Y-2 Schedule Y-1 If taxable of the If taxable income is: But not amount income is: But not Over- over- The tax is: over- Over- over- The tax is: $ 0 $ 19,400 ......... 10% $ 0 $ 0 $ 9,700 ......... 10% 19,400 78,950 $ 1,940.00 + 12% 19,400 9,700 39,475 $ 970.00 + 12% 78,950 168,400 9,086.00 + 22% 78,950 39,475 84,200 4,543.00 + 22% 168,400 321,450 28,765.00 + 24% 168,400 84,200 160,725 14,382.50 +24% 321,450 408,200 65,497.00+ 32% 321,450 160,725 204,100 32,748.50 + 32% 408,200 612,350 93,257.00 + 35% 408,200 204,100 306,175 46,628.50 + 35% 612,350 164,709.50 + 37% 612,350 306,175 82,354.75 + 37% 13,850 52,850 84,200 160,700 204,100 510,300 of the amount over $ 0 9,700 39,475 84,200 160,725 204,100 306, 175 of the amount over ......... 10% $ 0 14,100 53,700 2020 Tax Rate Schedules Single-Schedule Head of householdSchedule Z If taxable of the If taxable income is: But not amount income is: But not Over- over- The tax is: over- Over- over- The tax is: $ 0 $ 9,875 10% $ 0 $ 0 $ 14,100 9,875 40,125 $ 987.50 + 12% 9,875 14,100 53,700 $ 1,410.00 + 12% 40,125 85,525 4,617.50 + 22% 40,125 53,700 85,500 6,162.00 +22% 85,525 163,300 14,605.50 + 24% 85,525 85,500 163,300 13,158.00 +24% 163,300 207,350 33,271.50 + 32% 163,300 163,300 207,350 31,830.00 + 32% 207,350 518,400 47,367.50 + 35% 207,350 207,350 518,400 45,926.00 + 35% 518,400 156,235.00 + 37% 518,400 518,400 154,793.50 + 37% Married filing jointly or Qualifying widow(er)- Married filing separately-Schedule Y-2 Schedule Y-1 If taxable of the If taxable income is: But not amount income is: But not Over- over The tax is: over- Over- over- The tax is: $ 0 $ 19,750 $ 0 $ 0 $ 9,875 .........10% 19,750 80,250 $ 1,975.00 + 12% 19,750 9,875 40,125 $ 987.50 + 12% 80,250 171,050 9,235.00 + 22% 80,250 40,125 85,525 4,617.50 + 22% 171,050 326,600 29,211.00 + 24% 171,050 85,525 163,300 14,605.50 +24% 326,600 414,700 66,543.00 + 32% 326,600 163,300 207,350 33,271.50 + 32% 414,700 622,050 94,735.00 + 35% 414,700 207,350 311,025 47,367.50 + 35% 622,050 167,307.50 + 37% 622,050 311,025 83,653.75 + 37% 85,500 163,300 207,350 518,400 of the amount over- $ 0 ......... 10% 9,875 40,125 85,525 163,300 207,350 311,025