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URL:  http://boards.fool.com/ok-in-tt-quotwhat-ifquot-i-backed-out-capital-30851627.aspx

Subject:  Re: amt for 2013? Date:  8/31/2013  9:56 PM
Author:  lethean Number:  119111 of 121585

OK. In TT "what if" I backed out capital gains incrementally until relieved of AMT.

Relieved of AMT at cap gain of 48,795. Which means I backed out 22,640 of cap gain.

At 71,435 cap gain. Tax on full taxable income = 25,856

AT 48,795. Tax on full taxable income = 18,597.

Tax Difference = 7,259 on the 22,640 cap gain backed out. Yikes.

7,259/22,640 = 33% "effective" cap gain in AMT.

Wow. I really blew it. Roth was available. But I didn't want to use the Roth to save 15% cap gain tax. However, given the AMT status that I did NOT anticipate, it seems like I missed a GREAT opportunity to use the Roth to avoid AMT and an "effective" 33% cap gain rate on that 22,640 cap gain.

Sheesh. Lesson learned. Use "what if" BEFORE transacting. ALWAYS.

I HOPE that this sorry tale helps someone else avoid this situation.

Stupid. Stupid. Stupid.

ML
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