Maple Corporation reports $500,000 of regular taxable income for the current year. Maple also reports the following amounts of interest income earned during the current year (reflected in regular taxable income, if applicable):
Franklin County bonds ………………………………. $5,000
Omega Corporation bonds …………………………… 4,400
Springfield School District bonds …………………… 3,700
U.S. Treasury bonds ………………………………….. 2,100
The Springfield School District bonds are general obligation bonds and are not private activity bonds. The Franklin County bonds were issued to finance redevelopment activities and are private activity bonds. Maple’s preference and adjustment items (other than those relating to interest income) are a net positive $100,000, and its items to adjust from preadjustment AMTI to adjusted current earnings (other than those relating to interest income) are a net positive $125,000.
a. Assuming none of the bonds were issued in 2009 or 2010, determine Maple’s alternative minimum taxable income for the current year.
b. How would your answer to Part a change if the Franklin County bonds were issued in 2010?