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Foothills Corporation's AMTI is $569,000 for 2015. Its regular tax liability is $110,000. What is its...

Foothills Corporation's AMTI is $569,000 for 2015. Its regular tax liability is $110,000. What is its AMT?

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Answer #1

Foothills Corporation’s AMT is computed using the difference between Normal Tentative minimum tax and regular tax liability.

          Foothills tentative minimum tax comes to $113,800

                      ($569,000 × 20 percent=$113,800).

Where as his regular tax liability =$110,000

The difference between tentative minimum tax and regular tax liability is

AMT = $113,800 – $110,000.

AMT = $3,800  

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