Can Form 1120 Schedule M 3 Securities 2019-2024

Corporate alternative minimum tax applies to both individuals and corporations. - The alternative minimum tax rate for corporations is a flat 20%. - Individuals have a tiered rate with a part at 26% and a part at 28%. - Small business corporations are exempt from AMT if they have annual gross receipts under $7.5 million for the last three years. - Corporations are also exempt if they are in their first year of existence. - The AMT formula for corporations is similar to that for individuals. - Preferences and adjustments are added or subtracted to calculate pre-adjustment AMT. - Preferences include percentage of depletion in excess of cost basis and tax-exempt interest on private activity bonds. - Adjustments include the difference between regular depreciation and depreciation using the alternative depreciation system, and gains or losses on the sale of depreciable assets. - There are also other adjustments and items that go into the AMT calculation. - AMT net operating losses are deducted to calculate alternative minimum taxable income. - The AMT base is calculated by subtracting the AMT exemption from the alternative minimum taxable income. - The AMT base is then multiplied by a 20% tax rate to get the tentative minimum tax. - Corporations pay the larger of the tentative minimum tax or regular tax. - Any excess amount paid as alternative minimum tax generates a credit to be used to reduce regular tax liabilities in future years. - The amount due for AMT varies depending on the regular tax liability and the tentative minimum tax.