Question: Thomas Everett (age 51) is married and will file a joint return with his husband, Donnie (age 48). They have three dependent children. They anticipate
Thomas Everett (age 51) is married and will file a joint return with his husband, Donnie (age 48). They have three dependent children. They anticipate an AGI of $311K. They have $1K of tax-exempt interest from qualified private-activity municipal bonds issued in 2007. Tyler exercised an incentive stock option during the year. The option price was $35K, while the FMV of the stock at the time the option was exercised was $103K. State income and real estate taxes were $17K and $6,400 respectively. Assume that their income, deductions, and tax calculation (for regular income tax purposes) for 2023 are as follows:
| Adjusted gross income | $311K | |
| Deductions: | ||
| Charitable contributions (cash) | $18K | |
| State income taxes--$17,000 | ||
| Real estate taxes--$6,400 | $10K | ($10K limited SALT deduction) |
| Home mortgage interest | $15.5K | |
| Total itemized deductions | ($43,500) | |
| Taxable income | $267,500 | |
| Tax on $267,500 | $51,000 | |
| Less: child tax credit | 6,000 | |
| Total tax | 45,000 |
What is the amount, if any, of the AMT payable? (Start with AGI, or the technically-correct adjusted taxable income.)
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