Instructions For Form 4626 - Alternative Minimum Tax-Corporations

than the regular tax deduction, include

an adjustment for the difference

Income from the biofuel producer,

the result as a negative amount.

between the regular tax and AMT

biodiesel, and renewable diesel

amounts for all such deductions. If the

fuels credits. If this income was

Installment sales. The installment

AMT deduction is more than the regular

included in the corporation's income for

method does not apply for the AMT to

tax deduction, include the difference as

the regular tax, include this amount on

any nondealer disposition of property

a negative amount.

line 2o as a negative amount.

that occurred after August 16, 1986, but

before the first day of the corporation's

Line 4. Adjusted Current

Income as the beneficiary of an es-

tax year that began in 1987, if an

tate or trust. If the corporation is the

Earnings (ACE)

installment obligation to which the

beneficiary of an estate or trust, include

Adjustment

proportionate disallowance rule applied

on line 2o the AMT adjustment from

arose from the disposition. Include as a

Schedule K-1 (Form 1041), Part III,

The ACE adjustment does not

negative adjustment on line 2o the

box 12.

apply to a regulated investment

amount of installment sale income

Net AMT adjustment from an elect-

company or a real estate

reported for the regular tax.

CAUTION

ing large partnership. If the

investment trust. Also, for an affiliated

Accelerated depreciation of real

corporation is a partner in an electing

group filing a consolidated return under

property and certain leased person-

large partnership, include on line 2o the

the rules of section 1501, figure line 4b

al property (pre-1987). Refigure

amount from Schedule K-1 (Form

on a consolidated basis.

depreciation for the AMT using the

1065-B), box 6. Also include on line 2o

straight line method for real property for

Line 4b. The following examples

any amount from Schedule K-1 (Form

which accelerated depreciation was

illustrate the manner in which line 3 is

1065-B), box 5, unless the corporation

determined for the regular tax using

subtracted from line 4a to get the

is a closely held or personal service

pre-1987 rules. Use a recovery period of

amount to enter on line 4b.

corporation. Closely held and personal

19 years for 19-year real property and

service corporations should take any

Example 1. Corporation A has line 4a

15 years for low-income housing

amount from box 5 into account when

ACE of $25,000. If Corporation A has

property. Figure the excess of the

figuring the amount to enter on line 2j.

line 3 pre-adjustment AMTI in the

regular tax depreciation over the AMT

amounts shown below, its line 3 and

Patron's AMT adjustment.

depreciation separately for each

line 4a amounts would be combined as

Distributions the corporation received

property and include only positive

follows to determine the amount to enter

from a cooperative may be includible in

adjustments on line 2o.

on line 4b.

income. Unless the distributions are

The adjustment for leased personal

nontaxable, include on line 2o the total

property only applies to personal

AMT patronage dividend adjustment

Line 4a ACE

$25,000 $25,000

$25,000

holding companies. For leased personal

reported to the corporation from the

property other than recovery property,

Line 3 pre-adj.

cooperative.

enter the excess of the depreciation

10,000

30,000

(50,000)

AMTI

Cooperative's AMT adjustment. If the

claimed for the property for the regular

corporation is a cooperative, refigure

tax using pre-1987 rules over the

Amount to

the cooperative's deduction for

enter

depreciation allowable for the AMT as

on line 4b

$15,000 $(5,000)

$75,000

patronage dividends by taking into

refigured using the straight line method.

account the cooperative's AMT

For leased 10-year recovery property

adjustments and preferences. Subtract

and leased 15-year public utility

Example 2. Corporation B has line 4a

the cooperative's AMT deduction for

property, enter the excess of the regular

ACE of $(25,000). If Corporation B has

patronage dividends from its regular tax

tax depreciation over the depreciation

line 3 pre-adjustment AMTI in the

deduction for patronage dividends and

allowable using the straight line method

amounts shown below, its line 3 and

include the result on line 2o. If the AMT

with a half-year convention, no salvage

line 4a amounts would be combined as

deduction is more than the regular tax

value, and a recovery period of 15 years

follows to determine the amount to enter

deduction, include the result as a

(22 years for 15-year public utility

on line 4b.

negative amount.

property).

Domestic production activities de-

Figure this amount separately for

Line 4a

duction. For the AMT, figure the

each property and include only positive

ACE

$(25,000) $(25,000) $(25,000)

corporation's domestic production

adjustments on line 2o.

activities deduction under section 199

Line 3

This preference generally

without taking into account any AMT

pre-adj.

applies only to property placed

adjustments and preferences. The

(10,000)

(30,000)

50,000

AMTI

in service after 1987, but

section 199 deduction for the

CAUTION

depreciated using pre-1987 rules due to

Amount to

corporation's AMT is 9% of the smaller

transition provisions of the Tax Reform

enter

of (a) the qualified production activities

Act of 1986.

on line 4b

$(15,000)

$5,000 $(75,000)

income or (b) the alternative minimum

taxable income (AMTI), determined

Related adjustments. AMT

without taking into account the section

adjustments and preferences may affect

Line 4d. A potential negative ACE

199 deduction. Subtract the

deductions that are based on an income

adjustment (that is, a negative amount

corporation's AMT section 199

limit (for example, charitable

on line 4b multiplied by 75%) is allowed

deduction from its regular tax section

contributions). Refigure these

as a negative ACE adjustment on

199 deduction and include the result on

deductions using the income limit as

line 4e only if the corporation's total

line 2o. If the AMT deduction is more

modified for the AMT. Include on line 2o

increases in AMTI from prior year ACE

-6-

Instructions For Form 4626 - Alternative Minimum Tax-Corporations - 2017 Page 6

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