Instructions For Form 6251 - 2008 (Page 7 of 12) in pdf

from all oil, gas, and geothermal wells

Pollution Control Facilities

Related Adjustments

by the deductions allocable to those

The section 169 election to amortize

If you have an entry on line 9 because

wells (reduced by the excess IDCs).

the basis of a certified pollution control

you deducted investment interest

When refiguring net income, use only

facility over a 60-month or 84-month

allocable to an interest in a trade or

income and deductions allowed for the

period is not available for the AMT. For

business, or on line 10, 13, 14, or 16

AMT.

facilities placed in service before 1999,

through 26, or you have any amount

Exception. The preference for IDCs

figure the AMT deduction using ADS.

included on line 27 from pre-1987

from oil and gas wells does not apply to

For facilities placed in service after

depreciation, patron’s adjustment,

1998, figure the AMT deduction under

pollution control facilities, or tax shelter

taxpayers who are independent

producers (that is, not integrated oil

MACRS using the straight line method.

farm activities, you may have to refigure

companies as defined in section

Enter the difference between the

any item of income or deduction based

291(b)(4)). However, this benefit may

regular tax and AMT deduction. If the

on a limit of income other than AGI or

be limited. First, figure the IDC

AMT amount is greater, enter the

modified AGI.

difference as a negative amount.

preference as if this exception did not

Affected items include the following.

•

apply. Then, for purposes of this

Section 179 expense deduction

Tax Shelter Farm Activities

exception, complete Form 6251 through

(Form 4562, line 12).

Figure this adjustment only if you have

•

line 27, including the IDC preference,

Expenses for business or rental use

a gain or loss from a tax shelter farm

and combine lines 1 through 27. If the

of your home.

activity (as defined in section 58(a)(2))

amount of the IDC preference exceeds

•

Conservation expenses (Schedule F,

that is not a passive activity. If the

40% of the total of lines 1 through 27,

line 14).

activity is passive, you must include it

•

enter the excess on line 26 (your

Taxable IRA distributions (Form

with your other passive activities on line

benefit from this exception is limited).

1040, line 15b, or Form 1040NR, line

19.

Otherwise, do not enter an amount on

16b), if prior year IRA deductions were

line 26 (your benefit from this exception

Refigure all gains and losses you

different for the AMT and the regular

is not limited).

reported for the regular tax from tax

tax.

•

shelter farm activities by taking into

Self-employed health insurance

Line 27—Other Adjustments

account any AMT adjustments and

deduction (Form 1040, line 29, or Form

Enter on line 27 the total of any other

preferences. Determine your tax shelter

1040NR, line 28).

•

adjustments that apply to you, including

farm activity gain or loss for the AMT

Self-employed SEP, SIMPLE, and

the following.

using the same rules you used for the

qualified plans deduction (Form 1040,

regular tax with the following

line 28, or Form 1040NR, line 27).

Depreciation Figured Using

•

modifications. No refigured loss is

IRA deduction (Form 1040, line 32,

Pre-1987 Rules

allowed, except to the extent you are

or Form 1040NR, line 31), affected by

This preference generally only applies

insolvent (see section 58(c)(1)). A

the earned income limitation of section

to property placed in service after 1987,

refigured loss may not be used in the

219(b)(1)(B).

but depreciated using pre-1987 rules

current tax year to offset gains from

Figure the difference between the

due to transitional provisions of the Tax

other tax shelter farm activities. Instead,

AMT and regular tax amount for each

Reform Act of 1986.

any refigured loss must be suspended

item. Combine the amounts for all your

and carried forward indefinitely until (a)

For the AMT, you must use the

related adjustments and include the

you have a gain in a subsequent tax

straight line method to figure

total on line 27. Keep a copy of all

year from that same activity or (b) you

depreciation on real property for which

computations for your records,

dispose of the activity.

accelerated depreciation was

including any AMT carryover and basis

Enter the difference between the

determined using pre-1987 rules. Use a

amounts.

recovery period of 19 years for 19-year

amount that would be reported for the

Do not include on line 27 any

real property and 15 years for

activity on Schedule E or F or Form

adjustment for an item you

4835 for the AMT and the regular tax

low-income housing. For leased

refigured on another line of this

personal property other than recovery

amount. If (a) the AMT loss is more

CAUTION

form (for example, line 10).

property, enter the amount by which

than the regular tax loss, (b) the AMT

gain is less than the regular tax gain, or

your regular tax depreciation using the

Example. On your Schedule C

pre-1987 rules exceeds the

(Form 1040) you have a net profit of

tax gain, enter the adjustment as a

depreciation allowable using the

$9,000 before figuring your section 179

straight line method. For leased 10-year

negative amount.

deduction. You do not report any other

recovery property and leased 15-year

business income on your return. During

Enter any adjustment for amounts

public utility property, enter the amount

the year, you purchased an asset for

reported on Schedule D, Form 4684, or

by which your regular tax depreciation

$10,000 for which you elect to take the

Form 4797 for the activity on line 17

exceeds the depreciation allowable

section 179 deduction. You also have

instead of line 27.

using the straight line method with a

an AMT depreciation adjustment of

Charitable Contributions of

half-year convention, no salvage value,

$700 for other assets depreciated on

Certain Property

and a recovery period of 15 years (22

your Schedule C.

years for 15-year public utility property).

If you made a charitable contribution of

Your section 179 deduction for the

property to which section 170(e) applies

Figure the excess of the regular tax

regular tax is limited to your net profit

and you had a different basis for AMT

depreciation over the AMT depreciation

(before any section 179 deduction) of

purposes, you may have to make an

separately for each property and

$9,000. The $1,000 excess is a section

adjustment. See section 170(e) for

include on line 27 only positive

179 deduction carryforward for the

details.

amounts.

regular tax.

Alcohol, Biodiesel, and

Patron’s Adjustment

For the AMT, your net profit is

Renewable Diesel Fuels Credits

$9,700, and you are allowed a section

Distributions you received from a

179 deduction of $9,700 for the AMT.

cooperative may be includible in

If your taxable income includes an

You have a section 179 deduction

income. Unless the distributions are

amount from the alcohol fuel credit or

carryforward of $300 for the AMT.

nontaxable, include on line 27 the total

the biodiesel and renewable diesel

AMT patronage dividend adjustment

fuels credit under section 87, include

You include a $700 negative

reported to you by the cooperative,

that amount as a negative amount on

adjustment on line 27 because your

such as on Form 1099-PATR.

line 27.

section 179 deduction for the AMT is

-7-

Instructions For Form 6251 - 2008 Page 7

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