Alternative Minimum Tax(AMT)
A federal tax aimed at ensuring that wealthy individuals, estates, trusts , and corporations pay a minimal level income tax . For individuals, the AMT is calculated by adding adjusted gross income to tax preference items . | ||||
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Alternative Minimum Tax (AMT) definition was found in categories: Business & Finance(1)
Alternative Minimum Tax (AMT) Definition from Business & Finance Dictionaries & Glossaries
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Alternative Minimum Tax (AMT)
A separate tax calculation in which a taxpayer must pay the higher of its regular tax or AMT liability. The corporate AMT rate- although lower than the regular tax rate- is applied to a different- typically higher- taxable income than for regular taxes. Introduced in 1969- The Tax Reform Act of 1986 substantially modified the AMT- which all taxpayers must calculate. In 1997- AMT shortened accelerated depreciation preference item from ADR class life to MACRS life.
A separate tax calculation in which a taxpayer must pay the higher of its regular tax or AMT liability. The corporate AMT rate- although lower than the regular tax rate- is applied to a different- typically higher- taxable income than for regular taxes. Introduced in 1969- The Tax Reform Act of 1986 substantially modified the AMT- which all taxpayers must calculate. In 1997- AMT shortened accelerated depreciation preference item from ADR class life to MACRS life.