Instructions For Form 4626 - Alternative Minimum Tax - Corporations

2 0 08

Department of the Treasury

Internal Revenue Service

Instructions for Form 4626

(Rev. March 2009)

Alternative Minimum Tax—Corporations

Generally, file Form 4626 if either of

corporation exempt from the AMT for its

Section references are to the Internal

the following apply.

previous tax year, but does not meet

Revenue Code unless otherwise noted.

•

The corporation’s taxable income or

the gross receipts test for its tax year

(loss) before the net operating loss

beginning in 2008, it loses its AMT

What’s New

(NOL) deduction plus its adjustments

exemption status. Special rules apply in

and preferences total more than

figuring AMT for the tax year beginning

•

This March 2009 revision of the 2008

$40,000 or, if smaller, its allowable

in 2008 and all later years based on the

Instructions for Form 4626 reflects

exemption amount.

“change date.” The change date is the

•

changes made by the American

The corporation claims any general

first day of the corporation’s tax year

Recovery and Reinvestment Tax Act of

business credit, any qualified electric

beginning in 2008 (the first tax year for

2009 and affects fiscal tax years ending

vehicle credit, or the credit for prior year

which the corporation ceased to be a

in 2009.

minimum tax.

small corporation). Where this applies,

•

Interest on private activity bonds

complete Form 4626 taking into

issued after December 31, 2008, and

Exemption for Small

account the following modifications.

•

before January 1, 2011, is not a tax

Corporations

The adjustments for depreciation and

preference item. In addition, there is no

amortization of pollution control facilities

A corporation is treated as a small

adjustment to adjusted current earnings

apply only to property placed in service

corporation exempt from the AMT for its

(ACE) for such interest. See the

on or after the change date.

current tax year beginning in 2008 if:

instructions for line 2m on page 5 and

•

The adjustment for mining

the instructions for line 3 of the ACE

1. The current year is the

exploration and development costs

Worksheet on page 9.

corporation’s first tax year in existence

applies only to amounts paid or

•

For tax years ending after May 22,

(regardless of its gross receipts for the

incurred on or after the change date.

2008, and tax years beginning before

year), or

•

The adjustment for long-term

May 23, 2009, if a corporation has both

2. Both of the following apply.

contracts applies only to contracts

a net capital gain and a qualified timber

a. It was treated as a small

entered into on or after the change

gain, for purposes of the alternative

corporation exempt from the AMT for all

date.

minimum tax, a maximum 15% tax may

prior tax years beginning after 1997.

•

When figuring the amount to enter on

apply to the qualified timber gain. Use

b. Its average annual gross receipts

line 6, for any loss year beginning

new Part II to figure the corporation’s

for the 3-tax-year period (or portion

before the change date, use the

alternative tax. See the instructions for

thereof during which the corporation

corporation’s regular tax NOL for that

Part II.

was in existence) ending before its tax

•

year.

The 90% limit on the alternative tax

year beginning in 2008 did not exceed

•

net operating loss deduction (ATNOLD)

Figure the limitation on line 4d only

$7.5 million ($5 million if the corporation

does not apply to the portion of the

for prior tax years beginning on or after

had only 1 prior tax year).

ATNOLD attributable to certain qualified

the change date.

•

disaster losses. See the instructions for

Enter zero on line 2c of the Adjusted

The following rules apply when

line 6 on page 7.

Current Earnings (ACE) Worksheet on

figuring gross receipts under 2b above.

•

page 11. When completing line 5 of the

Gross receipts must be figured using

General Instructions

ACE Worksheet, take into account only

the corporation’s tax accounting

amounts from tax years beginning on or

method and include total sales (net of

after the change date. Also, for line 8 of

returns and allowances), amounts

Purpose of Form

the ACE Worksheet, take into account

received for services, and income from

Use Form 4626 to figure the alternative

only property placed in service on or

investments and other sources. See

minimum tax (AMT) under section 55

after the change date.

Temporary Regulations section

for a corporation that is not exempt

1.448-1T(f)(2)(iv) for more details.

Note. No additional modification in

•

from the AMT.

Gross receipts include those of any

figuring AMT is required for exceptions

predecessor of the corporation,

Consolidated returns. For an

related to any item acquired in a

including non-corporate entities.

affiliated group filing a consolidated

corporate acquisition under section 381

•

For a short tax year, gross receipts

return under the rules of section 1501,

or to any substituted basis property, if

must be annualized by multiplying them

AMT must be figured on a consolidated

any of the AMT adjustment

by 12 and dividing the result by the

basis.

modifications listed earlier applied to

number of months in the tax year.

the item or property while it was held by

•

The gross receipts of all persons

Who Must File

the transferor.

treated as a single employer under

section 52(a), 52(b), 414(m), or 414(o)

If the corporation is a “small

Once the corporation loses its

must be aggregated.

corporation” exempt from the

small corporation status, it

AMT (as explained below), do

Loss of small corporation status. If

cannot qualify for any

CAUTION

not file Form 4626.

the corporation qualified as a small

subsequent tax year.

Cat. No. 64443L

Instructions For Form 4626 - Alternative Minimum Tax - Corporations - 2008

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