The tax laws give preferential treatment to certain kinds of income
and allow special deductions and credits for some kinds of expenses.
The alternative minimum tax attempts to ensure that all individuals
who benefit from these tax advantages will pay at least a minimum
amount of tax.
The alternative minimum tax is a separate tax computation that, in
effect, eliminates many deductions and credits, thus creating a tax
liability for an individual who would otherwise pay little or no tax.
You may have to pay the alternative minimum tax if your taxable
income for regular tax purposes, plus any of the adjustments and
preference items that apply to you, is more than an exemption amount.
The exemption amounts are:
$45,000 if you are married filing jointly or a qualifying widow
$33,750 if you are single or head of household; or
$22,500 if you are married filing separately, or an estate or
To determine if you may be subject to the alternative minimum tax,
see the 1996 Form 1040 instructions for line 46.
If you are liable for alternative minimum tax, you should complete
Form 6251 Alternative Minimum Tax - Individuals. Refer to Form 6251
and its instructions. If you paid alternative minimum tax last year,
you may be eligible to take a special credit against your regular
tax. If eligible for 1996, you should report this credit on Line 42
of Form 1040 and check Box C.
Also, use Form 8801, Credit for Prior Year Minimum Tax - Individuals
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