Instructions For Form 6251 - 2008 (Page 5 of 12) in pdf

allowance (discussed later on this

method not expressed in a term of

tax deduction, enter the difference as a

page));

years.

negative amount.

•

Qualified Indian reservation property.

Section 1250 property placed in

In addition to the AMT adjustment to

•

Qualified revitalization expenditures

service after 1998 that is not

your deduction for depreciation, you

for a building for which you elected to

depreciated for the regular tax using

must also adjust the amount of

claim the commercial revitalization

the straight line method; and

depreciation that was capitalized, if any,

•

deduction under section 1400I.

Tangible property placed in service

to account for the difference between

•

A natural gas gathering line placed in

after 1986 and before 1999. (If the

the rules for the regular tax and the

service after April 11, 2005.

transitional election was made under

AMT. Include on this line the current

section 203(a)(1)(B) of the Tax Reform

year adjustment to taxable income, if

How Is Depreciation Refigured

Act of 1986, this rule applies to property

any, resulting from the difference.

for the AMT?

placed in service after July 31, 1986.)

Line 19—Passive Activities

Property placed in service before

What Depreciation Is Not

1999. Refigure depreciation for the

Your passive activity gains and losses

Refigured for the AMT?

AMT using ADS, with the same

must be refigured for the AMT by taking

convention used for the regular tax.

into account all adjustments and

Do not refigure depreciation for the

See the following table for the method

preferences and any AMT prior year

AMT for the following.

•

and recovery period to use.

unallowed losses that apply to that

Residential rental property placed in

activity. You may fill out a second Form

service after 1998.

Property Placed in Service Before 1999

•

8582, Passive Activity Loss Limitations,

Nonresidential real property with a

and the other forms or schedules on

class life of 27.5 years or more placed

IF the property is... THEN use the...

which your passive activities are

in service after 1998 that is depreciated

section 1250

straight line method

reported, to determine your passive

for the regular tax using the straight line

property

over 40 years.

activity loss allowed for the AMT, but do

method.

•

not file the second set of forms and

Other section 1250 property placed

tangible property

straight line method

schedules with your tax return.

(other than section

over the property’s

in service after 1998 that is depreciated

1250 property)

AMT class life.

Example. You are a partner in a

for the regular tax using the straight line

depreciated using

partnership and the Schedule K-1

method.

•

straight line method

(Form 1065) you received shows the

Property (other than section 1250

for the regular tax

following.

property) placed in service after 1998

•

A passive activity loss of $4,125,

that is depreciated for the regular tax

any other tangible

150% declining

•

A depreciation adjustment of $500 on

using the 150% declining balance

property

balance method,

post-1986 property, and

method or the straight line method.

switching to straight

•

An adjustment of $225 on the

Property for which you elected to use

line method the first

disposition of property.

tax year it gives a

the alternative depreciation system

larger deduction,

(ADS) of section 168(g) for the regular

Because the two adjustments above

over the property’s

tax.

are not allowed for the AMT, you must

•

AMT class life.

Qualified property that is or was

first reduce the passive activity loss by

eligible for a special depreciation

those amounts. The result is a passive

Property placed in service after 1998.

allowance if the depreciable basis of

activity loss for the AMT of $3,400. You

Use the same convention and recovery

the property for the AMT is the same as

then enter this amount on the AMT

period used for the regular tax. For

for the regular tax. This applies to any

Form 8582 and refigure the allowable

property other than section 1250

special depreciation allowance,

passive activity loss for the AMT.

property, use the 150% declining

including those for qualified disaster

The amount of any AMT passive

balance method, switching to straight

assistance property, qualified reuse and

TIP

activity loss that is not

line the first tax year it gives a larger

recycling property, qualified cellulosic

deductible and is carried

deduction. For section 1250 property,

biofuel plant property, qualified New

forward is likely to differ from the

use the straight line method.

York Liberty Zone property, qualified

regular tax amount, if any. Therefore,

Gulf Opportunity Zone property, and

How Is the AMT Class Life

keep adequate records for both the

Kansas disaster area qualified recovery

Determined?

AMT and regular tax.

assistance property. The special

The class life used for the AMT is not

Enter the difference between the

allowance is deductible for the AMT,

necessarily the same as the recovery

amount that would be reported for the

and there also is no adjustment

period used for the regular tax. The

activity on Schedule C, C-EZ, E, or F or

required for any depreciation figured on

class lives for the AMT are listed in

Form 4835, Farm Rental Income and

the remaining basis of the qualified

Rev. Proc. 87-56, 1987-2 C.B. 674, and

Expenses, for the AMT and the regular

property if the depreciable basis of the

in Pub. 946, How To Depreciate

tax amount. If (a) the AMT loss is more

property for the AMT is the same as for

Property. Use 12 years for any tangible

than the regular tax loss, (b) the AMT

the regular tax. Property for which an

personal property not assigned a class

gain is less than the regular tax gain, or

election is in effect to not have the

life.

special allowance apply is not qualified

tax gain, enter the adjustment as a

property.

See Pub. 946 for tables that

•

negative amount.

Any part of the cost of any property

TIP

may be used to figure AMT

for which you made the election under

Enter any adjustment for amounts

depreciation. Rev. Proc. 89-15,

section 179 to treat the cost of the

reported on Schedule D, Form 4684, or

1989-1 C.B. 816, has special rules for

property as a deductible expense. The

Form 4797 for the activity on line 17

short years and for property disposed

reduction to the depreciable basis of

instead of line 19. See the instructions

of before the end of the recovery

section 179 property by the amount of

for line 17 on page 4.

period.

the section 179 expense deduction is

How Is the Adjustment

Publicly Traded Partnership

the same for the regular tax and the

Figured?

(PTP)

AMT.

•

Motion picture films, videotapes, or

Subtract the AMT deduction for

If you had a loss from a PTP, refigure

sound recordings.

depreciation from the regular tax

the loss using any AMT adjustments

•

Property depreciated under the

deduction and enter the result. If the

and preferences and any AMT prior

unit-of-production method or any other

AMT deduction is more than the regular

year unallowed loss.

-5-

Instructions For Form 6251 - 2008 Page 5

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