Farr, who is single, has no dependents and does not itemize. She shows the following items relative to her 2012 tax return.
|
Bargain element from the exercise of an ISO (no restrictions |
|
|
apply to the stock) |
$ 45,000 |
|
MACRS depreciation on shopping mall building acquired in |
|
|
1990 (ADS depreciation would have yielded $26,000) |
49,000 |
|
Percentage depletion in excess of property’s adjusted basis |
50,000 |
|
Taxable income for regular income tax purposes |
121,000 |
a. Determine Farr’s AMT adjustments and preferences.
b. Calculate the AMT (if any).