Sylvester files as a single taxpayer during 2014 and claims one personal exempti

Question

Sylvester files as a single taxpayer during 2014 and claims one personal exemption. He itemizes deductions for regular tax purposes. He paid charitable contributions of $15,000, real estate taxes of $1,900, state income taxes of $4,250, and interest on a home-equity loan of $3,000. Sylvester’s regular taxable income is $166,000.

What is Sylvester's AMTI if he used the home-equity proceeds to purchase a car?

What is Sylvester's AMTI if he used the home-equity loan proceeds to build a new garage next to his home?

Sylvester files as a single taxpayer during 2014 and claims one personal exemption. He itemizes deductions for regular tax purposes. He paid charitable contributions of $15,000, real estate taxes of $1,900, state income taxes of $4,250, and interest on a home-equity loan of $3,000. Sylvester’s regular taxable income is $166,000.

Explanation / Answer

a)
(1)Regular taxable income $166,000  
(2) Personal exemption 3,650  
(3) Real estate 1,900   Not deductible for AMT
(4) State income taxes 4,250   Not deductible for AMT
(5) Home equity loan interest   3,000   Not deductible for AMT (see note below)

TOTAL 178800

b)
(1)Regular taxable income   $166,000  
(2) Personal exemption       3,650  
(3) Real estate 1,900   Not deductible for AMT
(4) State income taxes       4,250   Not deductible for AMT

TOTAL 175800

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