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Subject:  amt for 2013? Date:  8/31/2013  8:47 PM
Author:  lethean Number:  119109 of 129400

I need some help understanding what is happened here for 2013. I completed a "what if" in TT and was surprised to see that AMT was triggered - by LT cap gains, apparently.

I expected a 25% marginal tax bracket and 15% LT cap gains. Instead I seem to get AMT at 27%? (That 15% cap gain rate was an important consideration when I sold the stock. An alternative was a Roth distribution. Or even a mortgage. I thought I was choosing instead a 15% cap gain rate. NOT???)

I'd really like to better understand AMT. It seems as though my cap gains are effectively taxed at 26% under AMT for 2013?

Caveat. This is NOT a normal year. But here are the #s for 2013 in hopes that someone can parse it out for me re what happened.

LT cap gain: 71,435.

RMD: 71,322.

Taxable SS: 37,137.

Tot Inc: 175,019.

AGI: 175,019.

St Deduct: (14,600).

3 Exempts: (11,700).

Taxable Inc: 148,719.

Tax: 21,885.

AMT: 3971.

Tax: 25,856.


My attempt at AMT:

AGI: 175,019

Exempt: 80,800

= : 94,219

And, 94,219 X 26% = 24,497.

OR, 94,219 x 27% = 25,439. Which is closer to the 25,856 above #.


Is the effective cap gain rate 27% in this example? Did the AMT exemption phase out apply, too? Or what?

Thank you.


ps Hindsight. I should have run "what if" before the sale. I just never DREAMED that the sale would trigger AMT.
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