Instructions For Form 4626 - 2010


Department of the Treasury
Internal Revenue Service
Instructions for Form 4626
Alternative Minimum Tax—Corporations
a. It was treated as a small
When figuring the amount to enter on
Section references are to the Internal
corporation exempt from the AMT for all
line 6, for any loss year beginning
Revenue Code unless otherwise noted.
prior tax years beginning after 1997.
before the change date, use the
corporation’s regular tax NOL for that
b. Its average annual gross receipts
What’s New
for the 3-tax-year period (or portion
Figure the limitation on line 4d only
thereof during which the corporation
For tax years beginning in 2010,
for prior tax years beginning on or after
was in existence) ending before its tax
eligible small business credits can
the change date.
year beginning in 2010 did not exceed
offset both regular tax and alternative
Enter zero on line 2c of the Adjusted
$7.5 million ($5 million if the corporation
minimum tax (AMT). Any unused credit
Current Earnings (ACE) Worksheet on
had only 1 prior tax year).
page 11. When completing line 5 of the
can be carried back five years and can
ACE Worksheet, take into account only
be used to offset regular tax and AMT
The following rules apply when
amounts from tax years beginning on or
in the carryback years. For more
figuring gross receipts under 2b above.
after the change date. Also, for line 8 of
information, see the Instructions for
Gross receipts must be figured using
the ACE Worksheet, take into account
Form 3800.
the corporation’s tax accounting
only property placed in service on or
method and include total sales (net of
after the change date.
General Instructions
returns and allowances), amounts
Note. No additional modification in
received for services, and income from
figuring AMT is required for exceptions
investments and other sources. See
Purpose of Form
related to any item acquired in a
Temporary Regulations section
corporate acquisition under section 381
1.448-1T(f)(2)(iv) for more details.
Use Form 4626 to figure the alternative
or to any substituted basis property, if
minimum tax (AMT) under section 55
Gross receipts include those of any
any of the AMT adjustment
for a corporation that is not exempt
predecessor of the corporation,
modifications listed earlier applied to
from the AMT.
including non-corporate entities.
the item or property while it was held by
For a short tax year, gross receipts
Consolidated returns. For an
the transferor.
must be annualized by multiplying them
affiliated group filing a consolidated
by 12 and dividing the result by the
Once the corporation loses its
return under the rules of section 1501,
number of months in the tax year.
small corporation status, it
AMT must be figured on a consolidated
The gross receipts of all persons
cannot qualify for any
treated as a single employer under
subsequent tax year.
section 52(a), 52(b), 414(m), or 414(o)
Who Must File
must be aggregated.
Credit for Prior Year
Generally, file Form 4626 if any of the
Loss of small corporation status. If
Minimum Tax
following apply.
the corporation qualified as a small
The corporation is not a “small
A corporation may be able to take a
corporation exempt from the AMT for its
corporation” exempt from the AMT (as
minimum tax credit against the regular
previous tax year, but does not meet
explained below).
tax for AMT incurred in prior years. See
the gross receipts test for its tax year
The corporation’s taxable income or
Form 8827, Credit for Prior Year
beginning in 2010, it loses its AMT
(loss) before the net operating loss
Minimum Tax — Corporations, for
exemption status. Special rules apply in
(NOL) deduction plus its adjustments
figuring AMT for the tax year beginning
and preferences total more than
in 2010 and all later years based on the
$40,000 or, if smaller, its allowable
“change date.” The change date is the
exemption amount.
first day of the corporation’s tax year
Certain items of income, deductions,
The corporation claims any general
beginning in 2010 (the first tax year for
credits, etc., receive different tax
business credit, any qualified electric
which the corporation ceased to be a
treatment for the AMT than for the
vehicle passive activity credit from prior
small corporation). Where this applies,
regular tax. Therefore, the corporation
years, or the credit for prior year
complete Form 4626 taking into
should keep adequate records to
minimum tax.
account the following modifications.
support items refigured for the AMT.
The adjustments for depreciation and
Examples include:
Exemption for Small
amortization of pollution control facilities
Tax forms used for regular tax
apply only to property placed in service
purposes that are completed a second
on or after the change date.
time to refigure items of income,
A corporation is treated as a small
The adjustment for mining
deductions, etc., for the AMT;
corporation exempt from the AMT for its
exploration and development costs
The computation of a carryback or
current tax year beginning in 2010 if:
applies only to amounts paid or
carryforward to other tax years of
1. The current year is the
incurred on or after the change date.
certain deductions or credits (for
corporation’s first tax year in existence
The adjustment for long-term
example, net operating loss, capital
(regardless of its gross receipts for the
contracts applies only to contracts
loss, and foreign tax credit) if the AMT
year), or
entered into on or after the change
amount is different from the regular tax
2. Both of the following apply.
Cat. No. 64443L


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