2012 Department of the Treasury
Internal Revenue Service
Instructions for Form 6251
Alternative Minimum Tax—Individuals
Section references are to the Internal Revenue
Code unless otherwise noted.
Recordkeeping Credit for Prior Year
For the AMT, certain items of income, Minimum Tax
deductions, etc., receive different tax
General Instructions treatment than for the regular tax.
See Form 8801, Credit for Prior Year
Minimum Tax—Individuals, Estates, and
Therefore, you need to refigure items for Trusts, if you paid AMT for 2011 or you
Future Developments the AMT that you figured for the regular had a minimum tax credit carryforward
For the latest information about tax. In some cases, you may wish to do on your 2011 Form 8801. If you pay
developments related to Form 6251 and this by completing the applicable tax AMT for 2012, you may be able to take
its instructions, such as legislation form a second time. If you do complete a credit on Form 8801 for 2013.
enacted after they were published, go to another form, do not attach it to your tax
www.irs.gov/form6251. return, but keep it for your records. Optional Write-Off for
However, you may have to attach an
What's New AMT Form 1116, Foreign Tax Credit, to
There is no AMT adjustment for the
your return; see the instructions for
The exemption amount has increased to following items if you elect for the
$50,600 ($78,750 if married filing jointly regular tax to deduct them ratably over
or qualifying widow(er); $39,375 if For the regular tax, some deductions the period of time shown.
married filing separately). and credits may result in carrybacks or Circulation expenditures—3 years
carryforwards to other tax years. (section 173).
Who Must File Examples are investment interest Research and experimental
Attach Form 6251 to your return if any of expense, a net operating loss, a capital expenditures—10 years (section
the following statements is true. loss, a passive activity loss, and the 174(a)).
foreign tax credit. Because you may
1. Form 6251, line 31, is greater Mining exploration and development
have to refigure these items for the
than line 34. costs—10 years (sections 616(a) and
AMT, the carryback or carryforward
2. You claim any general business 617(a)).
amount may be different for the AMT
credit, and either line 6 (in Part I) or Intangible drilling costs—60 months
than for the regular tax. Your at-risk
line 25 of any Form 3800 is more than (section 263(c)).
limits and basis amounts also may differ
zero. for the AMT. Therefore, you must keep For information on making the
3. You claim the qualified electric records of these different amounts. election, see section 59(e) and
vehicle credit, the personal use part of Regulations section 1.59-1. Also see
the alternative fuel vehicle refueling Partners and Shareholders Pub. 535, Business Expenses.
property credit, or the credit for prior If you are a partner in a partnership or a
year minimum tax.
4. The total of Form 6251, lines 8
shareholder in an S corporation, see
Schedule K-1 and its instructions to Specific Instructions
through 27, is negative and line 31 figure your adjustments or preferences If you owe AMT, you may be
would be greater than line 34 if you did from the partnership or S corporation to able to lower your total tax
not take into account lines 8 through 27. include on Form 6251. (regular tax plus AMT) by
claiming itemized deductions on Form
Purpose of Form Nonresident Aliens 1040, even if your total itemized
Use Form 6251 to figure the amount, if If you are a nonresident alien and you deductions are less than the standard
any, of your alternative minimum tax disposed of U.S. real property interests deduction. This is because the standard
(AMT). The AMT applies to taxpayers at a gain, you must make a special deduction is not allowed for the AMT
who have certain types of income that computation. Fill in Form 6251 through and, if you claim the standard deduction
receive favorable treatment, or who line 30. If your net gain from the on Form 1040, you cannot claim
qualify for certain deductions, under the disposition of U.S. real property itemized deductions for the AMT.
tax law. These tax benefits can interests and the amount on line 28 are
significantly reduce the regular tax of both greater than the tentative amount
some taxpayers with higher economic you figured for line 30, replace the
incomes. The AMT sets a limit on the amount on line 30 with the smaller of
amount these benefits can be used to that net gain or the amount on line 28.
reduce total tax. Also, enter “RPI” on the dotted line next
to line 30. Otherwise, do not change
Also use Form 6251 to help you line 30.
figure the tax liability limit on the credits
listed under Who Must File.
Jan 07, 2013 Cat. No. 64277P
Example. In 2012, Dave and
Home Mortgage Interest Adjustment Jennifer paid $10,000 in interest on a
Worksheet—Line 4 Keep for Your Records mortgage they took out to buy their
home (an eligible mortgage). In May
1. Enter the total of the home mortgage interest you deducted on lines 10
through 12 of Schedule A (Form 1040) and any mortgage insurance
2012, they refinanced that mortgage
premiums you deducted on line 13 of Schedule A (Form 1040) . . . . . . . . . 1. and paid $9,000 in interest through the
2. Enter the part, if any, of the interest included on line 1
rest of the year. The balance of the new
above that was paid on an eligible mortgage (defined in mortgage is the same as the balance of
the line 4 instructions). Include any mortgage insurance the old mortgage. In July 2012, they
premiums included on line 1 above that were paid in obtained a home equity loan on their
connection with an eligible mortgage . . . . . . . . . . . . . 2. home and used the proceeds to buy a
3. Enter the part, if any, of the interest included on line 1 new car. They paid $5,000 in interest on
above that was paid on a mortgage whose proceeds the home equity loan in 2012. They
were used in a refinancing (including a second or later enter the following amounts on the
refinancing) of an eligible mortgage. Include any Home Mortgage Interest Adjustment
mortgage insurance premiums included on line 1 above Worksheet: $24,000 on line 1 ($10,000
that were paid in connection with such a mortgage. Do
plus $9,000 plus $5,000), $10,000 on
not include any interest paid on (or any mortgage
insurance premiums paid in connection with) the part of
line 2, $9,000 on line 3, $ -0- on line 4,
the balance of the new mortgage that exceeded the $19,000 on line 5 ($10,000 plus
balance of the original eligible mortgage immediately $9,000), and $5,000 on line 6 ($24,000
before it was refinanced (or, if smaller, the balance of minus $19,000).
any prior refinanced mortgage immediately before that
mortgage was refinanced) . . . . . . . . . . . . . . . . . . . . 3. Line 5—Miscellaneous
4. Enter the part, if any, of the interest included on line 1 Deductions
above that was paid on a mortgage: If you are filing Form 1040NR, enter the
• Taken out before July 1, 1982, and amount from Schedule A (Form
• Secured, at the time the mortgage was taken out, by
1040NR), line 13.
your main home or a qualified dwelling used by you or
your family (see definitions on this page). Line 6—Reserved
Do not include any amount entered on line 2 or line 3
above . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.
Enter zero on line 6 or leave it blank.
5. Add lines 2 through 4 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5. Line 7—Refund of Taxes
6. Subtract line 5 from line 1 and enter the result on Form 6251, line 4 . . . . . . 6. Include any refund from Form 1040,
line 10 (or Form 1040NR, line 11), that
Part I—Alternative Form 1040NR. If you are filing Form is attributable to state or local income
taxes. Also include any refunds
Minimum Taxable Income 1040NR, enter the amount of all taxes
received in 2012 and included in income
from Schedule A (Form 1040NR), line 1,
(AMTI) except any generation-skipping transfer on Form 1040, line 21, that are
taxes on income distributions. attributable to state or local personal
To avoid duplication, any
property taxes or general sales taxes,
! adjustment or preference for Line 4—Home Mortgage foreign income taxes, or state, local, or
line 5, 19, or 20 or for a tax
Interest Adjustment foreign real property taxes. Enter the
shelter farm activity on line 27 must not
Complete the Home Mortgage Interest total as a negative amount. If you
be taken into account in figuring the
Adjustment Worksheet to figure the include an amount from Form 1040,
amount to enter for any other
amount to enter on this line. The line 21, you must enter a description
adjustment or preference.
definitions of certain terms used in the and the amount next to the entry space
Line 1 worksheet are as follows. for line 7. For example, if you include a
refund of real property taxes, enter “real
If Form 1040, line 43, includes a write-in Eligible mortgage. An eligible property” and the amount next to the
amount (such as a capital construction mortgage is a mortgage whose entry space.
fund deduction for commercial proceeds were used to buy, build, or
fishermen), adjust line 1 by the write-in substantially improve your main home Line 8—Investment Interest
amount. or a second home that is a qualified If you filled out Form 4952, Investment
Form 1040NR. If you are filing Form dwelling. A mortgage whose proceeds Interest Expense Deduction, for your
1040NR, enter the amount from Form were used to refinance another regular tax, you will need to fill out a
1040NR, line 39. If less than zero, enter mortgage is not an eligible mortgage. second Form 4952 for the AMT as
as a negative amount. Qualified dwelling. A qualified follows.
dwelling is any house, apartment, Step 1. Follow the Form 4952
condominium, or mobile home not used instructions for line 1, but also include
Enter the amount of all taxes from on a transient basis. the following amounts when completing
Schedule A (Form 1040), line 9, except line 1.
any generation-skipping transfer taxes Family. Family includes only your
brothers and sisters (whether by whole Any interest expense on Form 6251,
on income distributions.
or half blood), your spouse, your line 4, that was paid or accrued on
Be sure to include any state and local ancestors, and your lineal descendants. indebtedness attributable to property
general sales taxes from Schedule A, held for investment within the meaning
line 5. of section 163(d)(5) (for example,
-2- Instructions for Form 6251 (2012)
interest on a home equity loan whose Line 9—Depletion the ATNOLD and any domestic
proceeds were invested in stocks or Refigure your depletion deduction for production activities deduction. To do
bonds). the AMT. To do so, use only income this, first figure a tentative amount for
Any interest that would have been and deductions allowed for the AMT line 9 by treating line 11 as if it were
deductible if tax-exempt interest on when refiguring the limit based on zero. Next, figure a tentative total of
private activity bonds were includible in taxable income from the property under lines 1 through 27 using the tentative
gross income. section 613(a) and the limit based on line 9 amount and treating line 11 as if it
taxable income, with certain were zero. Add any domestic
Step 2. Enter your AMT disallowed production activities deduction to this
adjustments, under section 613A(d)(1).
investment interest expense from 2011 tentative total. Your ATNOLD is
Also, your depletion deduction for
on line 2. Complete line 3. limited to 90% of the result.
mines, wells, and other natural deposits
Step 3. When completing Part II, under section 611 is limited to the However, the 90% limit does not
refigure the following amounts, taking property's adjusted basis at the end of apply to an ATNOL that is attributable to
into account all adjustments and the year, as refigured for the AMT, qualified disaster losses (as defined in
preferences. unless you are an independent section 172(j)), qualified Gulf
Gross income from property held for producer or royalty owner claiming Opportunity Zone losses (as defined in
investment. percentage depletion for oil and gas section 1400N(k)(2)), qualified recovery
Net gain from the disposition of wells under section 613A(c). Figure this assistance losses (as defined in Pub.
property held for investment. limit separately for each property. When 4492-A, Information for Taxpayers
Net capital gain from the disposition refiguring the property's adjusted basis, Affected by the May 4, 2007, Kansas
of property held for investment. take into account any AMT adjustments Storms and Tornadoes), qualified
you made this year or in previous years disaster recovery assistance losses (as
that affect basis (other than current year defined in Pub. 4492-B, Information for
Include on line 4a any tax-exempt depletion). Affected Taxpayers in the Midwestern
interest income from private activity Disaster Areas), or a 2008 or 2009 loss
Enter the difference between the
bonds that must be included on Form that you elected to carry back more than
regular tax and AMT deduction. If the
6251, line 12. If you have any 2 years under section 172(b)(1)(H).
AMT deduction is greater, enter the
investment expenses that would have Therefore, if an ATNOL that is carried
difference as a negative amount.
been deductible if the interest on the back or carried forward to the tax year is
bonds were includible in gross income Line 10—Net Operating Loss attributable to any of those losses, the
for the regular tax, you can use them to Deduction ATNOLD for the tax year is limited to the
reduce the amount on line 4a or include sum of:
If you are filing Form 1040NR, enter
them on line 5. 1. The smaller of:
your net operating loss deduction from
On line 4g, enter the smaller of: Form 1040NR, line 21, as a positive a. The sum of the ATNOL
amount. carrybacks and carryforwards to the tax
1. The amount from line 4g of your
regular tax Form 4952, or Line 11—Alternative Tax Net year attributable to net operating losses
other than those losses described in 2a
2. The total of lines 4b and 4e of this Operating Loss Deduction below, or
AMT Form 4952. (ATNOLD) b. 90% of AMTI for the tax year
Step 4. Complete Part III. The ATNOLD is the sum of the (figured without regard to the ATNOLD
alternative tax net operating loss and any domestic production activities
Enter on Form 6251, line 8, the (ATNOL) carrybacks and carryforwards deduction, as discussed earlier), plus
difference between line 8 of your AMT to the tax year, subject to the limitation
2. The smaller of:
Form 4952 and line 8 of your regular tax explained later. Figure your ATNOLD as
Form 4952. If your AMT expense is follows. a. The sum of the ATNOL
greater, enter the difference as a carrybacks and carryforwards to the tax
negative amount. Your ATNOL for a loss year is the year attributable to qualified disaster
excess of the deductions allowed for losses, qualified Gulf Opportunity Zone
Investment interest expense that is figuring AMTI (excluding the ATNOLD) losses, qualified recovery assistance
not an itemized deduction. If you did over the income included in AMTI. losses, qualified disaster recovery
not itemize deductions and you had Figure this excess with the assistance losses, and any 2008 or
investment interest expense, do not modifications in section 172(d), taking 2009 loss that you elected to carry back
enter an amount on Form 6251, line 8, into account your AMT adjustments and more than 2 years under section 172(b)
unless you reported investment interest preferences (that is, the section 172(d) (1)(H), or
expense on Schedule E, Supplemental modifications must be separately
Income and Loss (Form 1040). If you b. 100% of AMTI for the tax year
figured for the ATNOL). For example, (figured without regard to the ATNOLD
did, follow the steps above for the limitation of nonbusiness deductions
completing Form 4952. Allocate the and any domestic production activities
to the amount of nonbusiness income deduction, as discussed earlier)
investment interest expense allowed on must be separately figured for the
line 8 of the AMT Form 4952 in the reduced by the amount determined
ATNOL, using only nonbusiness income under (1).
same way you did for the regular tax. and deductions that are included in
Enter on Form 6251, line 8, the AMTI. Enter on line 11 the smaller of the
difference between the amount allowed ATNOLD or the ATNOLD limitation.
on Schedule E for the regular tax and Your ATNOLD may be limited. To
the amount allowed on Schedule E for figure the ATNOLD limitation, you must Any ATNOL not used may be carried
the AMT. first figure your AMTI without regard to back 2 years or forward up to 20 years
Instructions for Form 6251 (2012) -3-
(15 years for loss years beginning Line 13—Qualified Small to a substantial risk of forfeiture. You did
before 1998). In some cases, the Business Stock not pay anything for the ISO. You did
carryback period is longer than 2 years; not sell the acquired stock during 2012.
for details, see Pub. 536. If you claimed the exclusion under You received a Form 3921 that shows
section 1202 for gain on qualified small $10 in box 3 (the exercise price you
The treatment of ATNOLs does not business stock held more than 5 years, paid for each share), $25 in box 4 (the
affect your regular tax NOL. multiply the excluded gain (as shown on fair market value of each share), and
Form 8949 in column (g)) by 7% (.07). 100 shares in box 5. To figure your
Since ATNOLs arising in loss Enter the result on line 13 as a positive
years beginning before 1998 adjustment, multiply the amount in
CAUTION can be carried forward no more
amount. box 4, $25, by the 100 shares in box 5.
than 15 years, you cannot carry forward Line 14—Exercise of Incentive The result is $2,500, the fair market
to 2012 an ATNOL from a loss Stock Options value of all the shares. Then multiply the
beginning before 1997. amount in box 3, $10, by the 100 shares
For the regular tax, no income is in box 5. The result is $1,000, the
recognized when an incentive stock amount you paid for all the shares. Your
Note. If you elected under section option (ISO), as defined in section adjustment is $1,500 ($2,500 − $1,000).
172(b)(3) to forgo the carryback period 422(b), is exercised. However, this rule Enter it on Form 6251, line 14.
for the regular tax, the election also does not apply for the AMT. Instead,
you generally must include on line 14 Line 16—Large Partnerships
applies for the AMT.
the excess, if any, of: If you were a partner in an electing large
Line 12—Interest From Private 1. The fair market value of the stock partnership, enter the amount from
Activity Bonds acquired through exercise of the option Schedule K-1 (Form 1065-B), box 6.
Enter on line 12 interest you earned on (determined without regard to any lapse Take into account any amount from
“specified private activity bonds” restriction) when your rights in the box 5 on Form 6251, line 19.
reduced (but not below zero) by any acquired stock first become transferable
Line 17—Disposition of
deduction that would have been or when these rights are no longer
subject to a substantial risk of forfeiture, Property
allowable if the interest were includible
in gross income for the regular tax. Each over Your AMT gain or loss from the
payer of this type of interest should 2. The amount you paid for the disposition of property may be different
send you a Form 1099-INT showing the stock, including any amount you paid for from your gain or loss for the regular tax.
amount of this interest in box 9. the ISO used to acquire the stock. This is because the property may have
a different adjusted basis for the AMT.
Generally, the term “specified private Even if your rights in the stock are not Use this line to report any AMT
activity bond” means any private activity transferable and are subject to a adjustment resulting from refiguring:
bond (as defined in section 141) the substantial risk of forfeiture, you may 1. Gain or loss from the sale,
interest on which is not includible in elect to include in AMT income the exchange, or involuntary conversion of
gross income for the regular tax, if the excess of the stock's fair market value property reported on Form 4797, Sales
bond was issued after August 7, 1986. (determined without regard to any lapse of Business Property;
But specified private activity bonds restriction) over the exercise price upon
generally do not include any bonds the transfer to you of the stock acquired 2. Casualty gain or loss to business
issued in 2009 or 2010. See section through exercise of the option. You or income-producing property reported
57(a)(5) for other exceptions and more must make the election by the 30th day on Form 4684, Casualties and Thefts;
details. after the date of the transfer. See Pub. 3. Ordinary income from the
525, Taxable and Nontaxable Income, disposition of property not already taken
Do not include interest on qualified for more details. into account in (1) or (2) or on any other
Gulf Opportunity Zone bonds or line on Form 6251, such as a
qualified Midwestern disaster area If you acquired stock by exercising
an ISO and you disposed of that stock in disqualifying disposition of stock
bonds. acquired in a prior year by exercising an
the same year, the tax treatment under
Exempt-interest dividends paid by a the regular tax and the AMT is the incentive stock option; and
mutual fund or other regulated same, and no adjustment is required. 4. Capital gain or loss (including any
investment company are treated as carryover that is different for the AMT)
Increase your AMT basis in any stock
interest income on specified private reported on Form 8949, Sales and
acquired through the exercise of an ISO
activity bonds to the extent the Other Dispositions of Capital Assets, or
by the amount of the adjustment. Keep
dividends are attributable to interest on Schedule D (Form 1040), Capital Gains
adequate records for both the AMT and
the bonds received by the company, and Losses.
regular tax so that you can figure your
minus an allocable share of the adjustment. See the instructions for First figure any ordinary income
expenses paid or incurred by the line 17. adjustment related to (3) above. Then,
company in earning the interest. This refigure Form 4684, Form 4797, Form
amount should be reported to you on Form 3921. If you received a Form 8949, and Schedule D for the AMT, if
Form 1099-DIV in box 11. 3921, it may help you figure your applicable, by taking into account any
If you are filing Form 8814, Parents' adjustment. adjustments you made this year or in
Election To Report Child's Interest and Example. You exercised an ISO to previous years that affect your basis or
Dividends, any tax-exempt interest acquire 100 shares of stock in 2012. otherwise result in a different amount for
income from line 1b of that form that is a Your rights in the acquired stock first the AMT.
preference item must be included on became transferable on the date you
this line. exercised the ISO and were not subject
-4- Instructions for Form 6251 (2012)
If you have a capital loss after AMT, Ash has a long-term capital loss What Depreciation Must Be
refiguring Schedule D for the AMT, of $40,000 ($60,000 minus his AMT Refigured for the AMT?
apply the $3,000 capital loss limitation basis of $100,000).
separately to the AMT loss. Because Generally, you must refigure
Ash has no other sales of stock or depreciation for the AMT, including
the amount of your gains and losses other capital assets for 2012. Ash enters
may be different for the AMT, the depreciation allocable to inventory
a total negative adjustment of $118,000 costs, for:
amount of any capital loss carryover on line 17 of his 2012 Form 6251,
also may be different for the AMT. See Property placed in service after 1998
figured as follows:
the following example. To figure your that is depreciated for the regular tax
Ash figures a negative adjustment of using the 200% declining balance
AMT capital loss carryover, fill out an $65,000 for the difference between the
AMT Capital Loss Carryover Worksheet method (generally 3-, 5-, 7-, and
$65,000 of regular tax ordinary income 10-year property under the modified
in the Schedule D instructions. and the $0 of AMT ordinary income for accelerated cost recovery system
For each of the four items listed the first sale. (MACRS), except for qualified property
earlier, figure the difference between the For the regular tax, Ash has $50,000 eligible for the special depreciation
amount included in taxable income for capital gain net income from the second allowance (discussed later));
the regular tax and the amount included sale. For the AMT, Ash has a $25,000 Section 1250 property placed in
in income for the AMT. Treat the short-term capital loss from the first service after 1998 that is not
difference as a negative amount if (a) sale, and a $40,000 long-term capital depreciated for the regular tax using the
both the AMT and regular tax amounts loss from the second sale, resulting in a straight line method; and
are zero or more and the AMT amount is net capital loss of $65,000 for the AMT.
Tangible property placed in service
less than the regular tax amount or (b) However, only $3,000 of the $65,000
after 1986 and before 1999. (If the
the AMT amount is a loss, and the net capital loss is allowed for 2012 for
transitional election was made under
regular tax amount is a smaller loss or is the AMT. The difference between the
section 203(a)(1)(B) of the Tax Reform
zero or more. regular tax gain of $50,000 and the
Act of 1986, this rule applies to property
$3,000 loss allowed for the AMT results
Enter on line 17 the combined placed in service after July 31, 1986.)
in a $53,000 negative adjustment to
adjustments for the four items listed
include on line 17.
earlier. What Depreciation Is Not
Ash has an AMT capital loss
Example. On March 13, 2011, carryover from 2012 to 2013 of $62,000, Refigured for the AMT?
Victor Ash, whose filing status is single, of which $22,000 is short-term and Do not refigure depreciation for the AMT
paid $20,000 to exercise an incentive $40,000 is long-term. If he has no other for the following.
stock option (which was granted to him Form 8949 or Schedule D transactions Residential rental property placed in
on January 3, 2010) to buy 200 shares for 2013, his adjustment reported on his service after 1998.
of stock worth $200,000. The $180,000 2013 Form 6251 would be limited to Nonresidential real property with a
difference between his cost and the ($3,000), the amount of his capital loss class life of 27.5 years or more placed in
value of the stock at the time he limitation for 2013. service after 1998 that is depreciated for
exercised the option is not taxable for
the regular tax using the straight line
the regular tax. His regular tax basis in Line 18—Post-1986
the stock at the end of 2011 is $20,000. Depreciation
For the AMT, however, Ash must Other section 1250 property placed in
This section describes when service after 1998 that is depreciated for
include the $180,000 as an adjustment
depreciation must be refigured for the the regular tax using the straight line
on his 2011 Form 6251. His AMT basis
AMT and how to figure the amount to method.
in the stock at the end of 2011 is
enter on line 18. Property (other than section 1250
Do not use line 18 for depreciation property) placed in service after 1998
On January 18, 2012, Ash sold 100 that is depreciated for the regular tax
of the shares for $75,000. Because Ash related to the following.
Employee business expenses using the 150% declining balance
did not hold these shares more than 1 method or the straight line method.
year, that sale is a disqualifying claimed on line 21 of Schedule A (Form
1040) or line 7 of Schedule A (Form Property for which you elected to use
disposition. For the regular tax, Ash has the alternative depreciation system
ordinary income of $65,000 ($75,000 1040NR). You should have already
taken this adjustment into account on (ADS) of section 168(g) for the regular
minus his $10,000 basis in the 100 tax.
shares). Ash has no capital gain or loss line 5 when you entered on that line the
total of your miscellaneous itemized Qualified property that is or was
for the regular tax resulting from the
deductions. eligible for a special depreciation
sale. For the AMT, Ash has no ordinary
Passive activities. Take this allowance if the depreciable basis of the
income, but has a short-term capital
adjustment into account on line 19. property for the AMT is the same as for
loss of $25,000 ($75,000 minus his
An activity for which you are not at the regular tax. This applies to any
$100,000 AMT basis in the 100 shares).
risk. Take this adjustment into account special depreciation allowance,
On April 21, 2012, Ash sold the other including those for qualified disaster
100 shares for $60,000. Because he on line 20.
assistance property, qualified reuse and
held the shares for more than 1 year Income or loss from a partnership or
recycling property, qualified cellulosic
and more than 2 years had passed an S corporation if the basis limitations
biofuel plant property, qualified New
since the option was granted to him, the apply. Take this adjustment into account
York Liberty Zone property, qualified
sale is not a disqualifying disposition. on line 20.
Gulf Opportunity Zone property, and
For the regular tax, Ash has a long-term A tax shelter farm activity. Take this
Kansas disaster area qualified recovery
capital gain of $50,000 ($60,000 minus adjustment into account on line 27.
assistance property. The special
his regular tax basis of $10,000). For the
Instructions for Form 6251 (2012) -5-
allowance is deductible for the AMT, For property other than section 1250 Because the two adjustments above
and there also is no adjustment required property, use the 150% declining are from the passive activity and are not
for any depreciation figured on the balance method, switching to straight allowed for the AMT, you must first
remaining basis of the qualified property line the first tax year it gives a larger reduce the passive activity loss by those
if the depreciable basis of the property deduction. For section 1250 property, amounts. The result is a passive activity
for the AMT is the same as for the use the straight line method. loss for the AMT of $3,400. You then
regular tax. Property for which an enter this amount on the AMT Form
election is in effect to not have the How Is the AMT Class Life 8582 and refigure the allowable passive
special allowance apply is not qualified activity loss for the AMT.
The class life used for the AMT is not The amount of any AMT
Any part of the cost of any property
necessarily the same as the recovery TIP passive activity loss that is not
for which you elected to take a section
period used for the regular tax. The deductible and is carried
179 expense deduction. The reduction
class lives for the AMT are listed in Rev. forward is likely to differ from the regular
to the depreciable basis of section 179
Proc. 87-56, 1987-2 C.B. 674, and in tax amount, if any. Therefore, keep
property by the amount of the section
Pub. 946, How To Depreciate Property. adequate records for both the AMT and
179 expense deduction is the same for
Use 12 years for any tangible personal regular tax.
the regular tax and the AMT.
Motion picture films, videotapes, or property not assigned a class life.
Enter the difference between the
sound recordings. See Pub. 946 for tables that amount that would be reported for the
Property depreciated under the TIP can be used to figure AMT activity on Schedule C, C-EZ, E, or F or
unit-of-production method or any other depreciation. Rev. Proc. 89-15, Form 4835, Farm Rental Income and
method not expressed in a term of 1989-1 C.B. 816, has special rules for Expenses, for the AMT and the regular
years. short years and for property disposed of tax amount. If (a) the AMT loss is more
Indian reservation property that before the end of the recovery period. than the regular tax loss, (b) the AMT
meets the requirements of section gain is less than the regular tax gain, or
168(j). (c) you have an AMT loss and a regular
Qualified revitalization expenditures How Is the Adjustment Figured?
tax gain, enter the adjustment as a
for which you elected to claim the Subtract the AMT deduction for negative amount.
commercial revitalization deduction depreciation from the regular tax
under section 1400I. deduction and enter the result. If the Enter any adjustment for amounts
A natural gas gathering line placed in AMT deduction is more than the regular reported on Form 8949, Schedule D,
service after April 11, 2005. tax deduction, enter the difference as a Form 4684, or Form 4797 for the activity
negative amount. on line 17 instead of line 19. See the
instructions for line 17.
How Is Depreciation Refigured for
the AMT? In addition to the AMT adjustment to
your deduction for depreciation, you Publicly Traded Partnership (PTP)
Property placed in service before must also adjust the amount of If you had a loss from a PTP, refigure
1999. Refigure depreciation for the depreciation that was capitalized, if any, the loss using any AMT adjustments
AMT using ADS, with the same to account for the difference between and preferences and any AMT prior
convention used for the regular tax. See the rules for the regular tax and the year unallowed loss.
the following table for the method and AMT. Include on this line the current
recovery period to use. year adjustment to taxable income, if
Tax Shelter Passive Farm
any, resulting from the difference.
Property Placed in Service Before 1999 Activities
Line 19—Passive Activities Refigure any gain or loss from a tax
IF the property is... THEN use the...
Refigure your passive activity gains and shelter passive farm activity taking into
section 1250 property straight line method losses for the AMT by taking into
over 40 years.
account all AMT adjustments and
account all adjustments and preferences and any AMT prior year
tangible property straight line method preferences and any AMT prior year unallowed losses. If the amount is a
(other than section over the property's unallowed losses that apply to that gain, include it on the AMT Form 8582.
1250 property) AMT class life. activity. You may fill out a second Form If the amount is a loss, do not include it
depreciated using 8582, Passive Activity Loss Limitations,
straight line method for
on the AMT Form 8582. Carry the loss
and the other forms or schedules on forward to 2013 to see if you have a
the regular tax
which your passive activities are gain or loss from tax shelter passive
any other tangible 150% declining reported, to determine your passive farm activities for 2013.
property balance method, activity loss allowed for the AMT, but do
switching to straight
not file the second set of forms and
line method the first Insolvency
tax year it gives a
schedules with your tax return.
If at the end of the tax year your
larger deduction, over Example. You are a partner in a
liabilities exceed the fair market value of
the property's AMT partnership and the Schedule K-1 (Form
class life. your assets, increase your passive
1065) you received shows the following.
activity loss allowed by that excess (but
A passive activity loss of $4,125, not by more than your total loss). See
A depreciation adjustment of $500 on section 58(c)(1).
Property placed in service after post-1986 property, and
1998. Use the same convention and An adjustment of $225 on the
recovery period used for the regular tax. disposition of property.
-6- Instructions for Form 6251 (2012)
Line 20—Loss Limitations described in section 460(b) to years for the AMT. Enter the difference
For passive activities, see the line 19 determine your income from any between the regular tax and AMT
instructions instead. For tax shelter farm long-term contract (defined in section deduction. If the AMT deduction is
activities (that are not passive), see the 460(f)). However, this rule does not greater, enter the difference as a
line 27 instructions. apply to any home construction contract negative amount.
(as defined in section 460(e)(6)). For
Refigure your gains and losses from contracts excepted from the If you had a loss on property for
activities for which you are not at risk percentage-of-completion method for which research and experimental costs
and basis limitations applicable to the regular tax by section 460(e)(1), you have not been fully amortized for the
partnerships and S corporations by must use the simplified procedures for AMT, your AMT deduction is the smaller
taking into account all AMT adjustments allocating costs outlined in section of (a) the loss allowable for the costs
and preferences that apply. See 460(b)(3) to determine the percentage had they remained capitalized or (b) the
sections 59(h), 465, 704(d), and of completion. remaining costs to be amortized for the
Enter the difference between the
Enter the difference between the
AMT and regular tax income. If the AMT
Line 25—Installment Sales
amount that would be reported for the The installment method does not apply
income is smaller, enter the difference
activity on Schedule C, C-EZ, E, or F or for the AMT to any nondealer
as a negative amount.
Form 4835 for the AMT and the regular disposition of property after August 16,
tax amount. If (a) the AMT loss is more Note. If you are required to use the 1986, but before January 1, 1987, if an
than the regular tax loss, (b) the AMT percentage-of-completion method for installment obligation to which the
gain is less than the regular tax gain, or either the regular tax or the AMT, you proportionate disallowance rule applied
(c) you have an AMT loss and a regular may owe or be entitled to a refund of arose from the disposition. Enter the
tax gain, enter the adjustment as a interest for the tax year the contract is amount of installment sale income
negative amount. completed or adjusted. For details, see reported for the regular tax as a
The AMT amount of any gain or loss Form 8697, Interest Computation Under negative amount on line 25.
from activities for which you are not at the Look-Back Method for Completed
risk is likely to differ from the regular tax Long-Term Contracts.
Line 26—Intangible Drilling
amount. Your AMT basis in partnerships Costs (IDCs)
and S corporations is also likely to differ
Line 23—Mining Costs
Do not make this adjustment
from your regular tax basis. Therefore, Do not make this adjustment for costs for which you elected
keep adequate records for both the
! for costs for which you elected
! the optional 60-month write-off
AMT and regular tax.
CAUTION the optional 10-year write-off for the regular tax.
Enter any adjustment for amounts for the regular tax.
reported on Form 8949, Schedule D, IDCs from oil, gas, and geothermal
Mining exploration and development wells are a preference to the extent that
Form 4684, or Form 4797 for the activity costs deducted in full for the regular tax
on line 17 instead of line 20. the excess IDCs are more than 65% of
in the tax year they were paid or the net income from the wells. Figure
Line 21—Circulation Costs incurred must be capitalized and the preference for all oil and gas
amortized over 10 years for the AMT. properties separately from the
Do not make this adjustment Enter the difference between the regular preference for all geothermal properties.
! for costs for which you elected tax and AMT deduction. If the AMT
CAUTION the optional 3-year write-off for deduction is greater, enter the Excess IDCs. Figure excess IDCs as
the regular tax. difference as a negative amount. follows.
Circulation costs (expenditures to If you had a loss on property for Step 1. Determine the amount of
establish, maintain, or increase the which mining costs have not been fully your IDCs allowed for the regular tax
circulation of a newspaper, magazine, amortized for the AMT, your AMT under section 263(c), but do not include
or other periodical) deducted in full for deduction is the smaller of (a) the loss any section 263(c) deduction for
the regular tax in the year they were allowable for the costs had they nonproductive wells.
paid or incurred must be capitalized and remained capitalized or (b) the Step 2. Subtract the amount that
amortized over 3 years for the AMT. remaining costs to be amortized for the would have been allowed had you
Enter the difference between the regular AMT. amortized these IDCs over a 120-month
tax and AMT deduction. If the AMT period starting with the month the well
deduction is greater, enter the Line 24—Research and
was placed in production. If you prefer
difference as a negative amount. Experimental Costs not to use the 120-month period, you
If you had a loss on property for Do not make this adjustment can elect to use any method that is
which circulation costs have not been for costs paid or incurred in permissible in determining cost
fully amortized for the AMT, your AMT !
CAUTION connection with an activity in depletion.
deduction is the smaller of (a) the loss which you materially participated under Net income. Determine net income by
allowable for the costs had they the passive activity rules or for costs for reducing the gross income that you
remained capitalized or (b) the which you elected the optional 10-year received or accrued during the tax year
remaining costs to be amortized for the write-off for the regular tax. from all oil, gas, and geothermal wells
Research and experimental costs by the deductions allocable to those
Line 22—Long-Term Contracts deducted in full for the regular tax in the wells (reduced by the excess IDCs).
For the AMT, you generally must use tax year they were paid or incurred must When refiguring net income, use only
the percentage-of-completion method be capitalized and amortized over 10
Instructions for Form 6251 (2012) -7-
income and deductions allowed for the Patron's Adjustment Enter any adjustment for amounts
AMT. reported on Form 8949, Schedule D,
Distributions you received from a
Form 4684, or Form 4797 for the activity
Exception. The preference for IDCs cooperative may be includible in
on line 17 instead of line 27.
from oil and gas wells does not apply to income. Unless the distributions are
taxpayers who are independent nontaxable, include on line 27 the total
producers (that is, not integrated oil AMT patronage dividend adjustment Charitable Contributions of Certain
companies as defined in section 291(b) reported to you by the cooperative, such Property
(4)). However, this benefit may be as on Form 1099-PATR. If you made a charitable contribution of
limited. First, figure the IDC preference property to which section 170(e) applies
as if this exception did not apply. Then, Pollution Control Facilities and you had a different basis for AMT
for purposes of this exception, complete purposes, you may have to make an
Form 6251 through line 27, including the The section 169 election to amortize the
basis of a certified pollution control adjustment. See section 170(e) for
IDC preference and treating line 11 as if details.
it were zero, and combine lines 1 facility over a 60-month or 84-month
through 27. If the amount of the IDC period is not available for the AMT. For
preference exceeds 40% of the total of facilities placed in service before 1999, Alcohol and Cellulosic Biofuel
lines 1 through 27 (figured as described figure the AMT deduction using ADS. Fuels Credit and Biodiesel and
in the preceding sentence), enter the For facilities placed in service after Renewable Diesel Fuels Credit
excess on line 26 (your benefit from this 1998, figure the AMT deduction under
MACRS using the straight line method. If your taxable income includes an
exception is limited). Otherwise, do not amount from the alcohol and cellulosic
enter an amount on line 26 (your benefit Enter the difference between the regular
tax and AMT deduction. If the AMT biofuel fuels credit or the biodiesel and
from this exception is not limited). renewable diesel fuels credit under
amount is greater, enter the difference
Line 27—Other Adjustments as a negative amount. section 87, include that amount as a
Enter on line 27 the total of any other negative amount on line 27.
adjustments that apply to you, including Tax Shelter Farm Activities
the following. Related Adjustments
Figure this adjustment only if you have a
gain or loss from a tax shelter farm If you have an entry on line 8 because
Depreciation Figured Using activity (as defined in section 58(a)(2)) you deducted investment interest
Pre-1987 Rules that is not a passive activity. If the allocable to an interest in a trade or
activity is passive, you must include it business, or on line 9, 13, 14, or 16
This preference generally only applies through 26, or you have any amount
to property placed in service after 1987, with your other passive activities on
line 19. included on line 27 from pre-1987
but depreciated using pre-1987 rules depreciation, patron's adjustment,
due to transitional provisions of the Tax Refigure all gains and losses you pollution control facilities, or tax shelter
Reform Act of 1986. reported for the regular tax from tax farm activities, you may have to refigure
shelter farm activities by taking into any item of income or deduction based
For the AMT, you must use the
account any AMT adjustments and on a limit of income other than AGI or
straight line method to figure
preferences. Determine your tax shelter modified AGI.
depreciation on real property for which
accelerated depreciation was farm activity gain or loss for the AMT
using the same rules you used for the Affected items include the following.
determined using pre-1987 rules. Use a
regular tax with the following Section 179 expense deduction
recovery period of 19 years for 19-year
modifications. ( Form 4562, Depreciation and
real property and 15 years for
No refigured loss is allowed, except Amortization, line 12).
low-income housing. For leased
personal property other than recovery to the extent you are insolvent (see Expenses for business or rental use
property, enter the amount by which section 58(c)(1)). of your home.
your regular tax depreciation using the Do not use a refigured loss in the Conservation expenses ( Schedule F,
pre-1987 rules exceeds the current tax year to offset gains from line 12).
depreciation allowable using the straight other tax shelter farm activities. Instead, Taxable IRA distributions ( Form
line method. For leased 10-year suspend any refigured loss and carry it 1040, line 15b, or Form 1040NR,
recovery property and leased 15-year forward indefinitely until (a) you have a line 16b), if prior year IRA deductions
public utility property, enter the amount gain in a subsequent tax year from that were different for the AMT and the
by which your regular tax depreciation same activity or (b) you dispose of the regular tax.
exceeds the depreciation allowable activity. Self-employed health insurance
using the straight line method with a deduction ( Form 1040, line 29, or Form
Enter the difference between the 1040NR, line 29).
half-year convention, no salvage value,
amount that would be reported for the Self-employed SEP, SIMPLE, and
and a recovery period of 15 years (22
activity on Schedule E or F or Form qualified plans deduction ( Form 1040,
years for 15-year public utility property).
4835 for the AMT and the regular tax line 28, or Form 1040NR, line 28).
Figure the excess of the regular tax amount. If (a) the AMT loss is more than IRA deduction ( Form 1040, line 32,
depreciation over the AMT depreciation the regular tax loss, (b) the AMT gain is or Form 1040NR, line 32), affected by
separately for each property and include less than the regular tax gain, or (c) you the earned income limitation of section
on line 27 only positive amounts. have an AMT loss and a regular tax 219(b)(1)(B).
gain, enter the adjustment as a negative
amount. Figure the difference between the
AMT and regular tax amount for each
-8- Instructions for Form 6251 (2012)
item. Combine the amounts for all your You have a section 179 deduction Special Rule for Holders of a
related adjustments and include the carryforward of $300 for the AMT. Residual Interest in a REMIC
total on line 27. Keep a copy of all You include a $700 negative
computations for your records, including If you held a residual interest in a real
adjustment on line 27 because your estate mortgage investment conduit
any AMT carryover and basis amounts. section 179 deduction for the AMT is (REMIC) in 2012, the amount you enter
Do not include on line 27 any $700 greater than your allowable on line 28 may not be less than the
adjustment for an item you regular tax deduction. In the following amount on Schedule E, line 38, column
CAUTION refigured on another line of this year, when you use the $1,000 regular (c). If the amount in column (c) is larger
form (for example, line 9). tax carryforward, you will have a $700 than the amount you would otherwise
positive related adjustment for the AMT enter on line 28, enter the amount from
Example. On your Schedule C because your AMT carryforward is only column (c) instead and enter “Sch. Q”
(Form 1040) you have a net profit of $300. on the dotted line next to line 28.
$9,000 before figuring your section 179
deduction. You do not report any other Line 28—Alternative Minimum
If your filing status is married filing
business income on your return. During Taxable Income separately, be sure to include the
the year, you purchased an asset for If your filing status is married filing additional amount that must be added to
$10,000 for which you elect to take the separately and line 28 is more than line 28 (as explained above) before you
section 179 deduction. You also have $232,500, you must include an compare line 28 with the amount on
an AMT depreciation adjustment of additional amount on line 28. If line 28 is Schedule E, line 38, column (c).
$700 for other assets depreciated on $390,000 or more, include an additional
your Schedule C. $39,375. Otherwise, include 25% of the Part II—Alternative
excess of the amount on line 28 over
Your section 179 deduction for the
$232,500. For example, if the amount Minimum Tax
regular tax is limited to your net profit
(before any section 179 deduction) of on line 28 is $252,500, enter $257,500 Line 29—Exemption Amount
$9,000. The $1,000 excess is a section instead—the additional $5,000 is 25%
179 deduction carryforward for the of $20,000 ($252,500 minus $232,500).
regular tax. IF your filing AND line 28 THEN enter
For the AMT, your net profit is status is ... is not over ... on line 29 ...
$9,700, and you are allowed a section Single or head $112,500 $50,600
179 deduction of $9,700 for the AMT. of household
Married filing 150,000 78,750
Exemption Worksheet— qualifying
Line 29 Keep for Your Records
Married filing 75,000 39,375
Note. If Form 6251, line 28, is equal to or more than: $314,900 if single or head of household, separately
$465,000 if married filing jointly or qualifying widow(er), or $232,500 if married filing separately, your
exemption is zero. Do not complete this worksheet; instead, enter the amount from Form 6251, If line 28 is more than the amount
line 28, on line 30 and go to line 31. shown for your filing status in the middle
1. Enter: $50,600 if single or head of household; $78,750 if married column of the table above, see the
filing jointly or qualifying widow(er); $39,375 if married filing Exemption Worksheet to figure the
separately . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1. amount to enter on line 29.
2. Enter your alternative minimum taxable
income (AMTI) from Form 6251, Certain Children Under Age 24
line 28 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2. Your exemption amount is limited to the
3. Enter: $112,500 if single or head of amount of your earned income plus
household; $150,000 if married filing jointly or $6,950 if condition 1, 2, or 3 below
qualifying widow(er); $75,000 if married filing applies to you.
separately . . . . . . . . . . . . . . . . . . . . . . . . . . 3. 1. You were under age 18 at the end
4. Subtract line 3 from line 2. If zero or less, of 2012.
enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.
2. You were age 18 at the end of
5. Multiply line 4 by 25% (.25) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5. 2012 and did not have earned income
6. Subtract line 5 from line 1. If zero or less, enter -0-. If any of the that was more than half of your support.
three conditions under Certain Children Under Age 24 apply to 3. You were a full-time student over
you, complete lines 7 through 10. Otherwise, stop here and age 18 and under age 24 at the end of
enter this amount on Form 6251, line 29, and go to Form 6251,
line 30 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2012 and did not have earned income
that was more than half of your support.
7. Minimum exemption amount for certain children under age
24 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7. $6,950 If condition 1, 2, or 3 applies to you,
complete the Exemption Worksheet,
8. Enter your earned income, if any (see instructions) . . . . . . . . . . 8. including lines 7 through 10, to figure
9. Add lines 7 and 8 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9. the amount to enter on Form 6251,
10. Enter the smaller of line 6 or line 9 here and on Form 6251,
line 29, and go to Form 6251, line 30 . . . . . . . . . . . . . . . . . . . .
Instructions for Form 6251 (2012) -9-
Exception. If you filed a joint return for self-employment tax). However, the Line 32—Alternative Minimum
2012 or neither of your parents was 30% limit does not apply if there are no Tax Foreign Tax Credit
alive at the end of 2012, do not net profits from the trade or business. If
capital is not an income-producing (AMTFTC)
complete lines 7 through 10 of the
Exemption Worksheet. However, you factor and your personal services To see if you need to figure
still must complete lines 1 through 6 of produced the business income, all of TIP your AMTFTC, fill in Form
the worksheet if Form 6251, line 28, is your gross income from the trade or 6251, line 34, as instructed.
more than the amount shown for your business is considered earned income. (You will first need to figure your foreign
filing status in the middle column of the Line 31 tax credit for the regular tax and
table above. complete Form 1040, line 47, or Form
If you claimed the foreign earned 1040NR, line 45.) If the amount on
Certain January 1 birthdays. If you income exclusion, housing exclusion, or line 34 is greater than or equal to the
were born on January 1, 1995, you are housing deduction on Form 2555 or amount on line 31, you do not owe the
considered to be 18 at the end of 2012. Form 2555-EZ, you must use the AMT. Enter -0- on line 35 and see Who
Your exemption amount is limited only if Foreign Earned Income Tax Worksheet Must File, earlier, to find out if you must
you did not have earned income that in these instructions to figure the attach Form 6251 to your return.
was more than half of your support. amount to enter on line 31. However, even if you do not owe the
If you were born on January 1, 1994, Form 1040NR. If you are filing Form AMT, you may need to complete line 32
you are considered to be 19 at the end 1040NR and you reported capital gain to see if you have an AMTFTC
of 2012. Your exemption amount is distributions directly on Form 1040NR, carryback or carryforward to other tax
limited only if you were a full-time line 14; you reported qualified dividends years.
student who did not have earned on Form 1040NR, line 10b; or you had a
income that was more than half of your If you made an election to claim the
gain on both lines 15 and 16 of
support. foreign tax credit on Form 1040 (or
Schedule D (Form 1040) (as refigured
Form 1040NR) without filing Form 1116,
If you were born on January 1, 1989, for the AMT, if necessary), complete
your AMTFTC is the same as the
you are considered to be 24 at the end Part III of Form 6251 and enter the
foreign tax credit on Form 1040, line 47
of 2012. Your exemption amount is not amount from line 54 on line 31. All other
(or Form 1040NR, line 45). Enter that
limited. Form 1040NR filers, do not complete
amount on Form 6251, line 32.
Part III. Instead, if Form 6251, line 30, is
Line 8 of the worksheet. Earned Otherwise, your AMTFTC is your foreign
$175,000 or less ($87,500 or less if you
income includes wages, tips, and other tax credit refigured as follows.
checked filing status box 3, 4, or 5 on
amounts received for personal services
Form 1040NR), figure the amount to Step 1. Use a separate AMT Form
performed. If you are a sole proprietor or
enter on line 31 by multiplying line 30 by 1116 for each separate category of
a partner in a trade or business in which
26% (.26). Otherwise, figure the amount income. Write “AMT” and specify the
both personal services and capital are
to enter on line 31 by multiplying line 30 category of income in the top margin of
material income-producing factors,
by 28% (.28) and subtracting $3,500 each Form 1116.
earned income also includes a
($1,750 if you checked filing status When applying the separate
reasonable allowance for compensation
box 3, 4, or 5) from the result. categories of income, use the applicable
for personal services, but not more than
30% of your share of the net profits from AMT rate instead of the regular tax rate
that trade or business (after subtracting to determine if any income is
the deduction for part of your “high-taxed.”
Foreign Earned Income Tax Worksheet—Line 31 Keep for Your Records
Before you begin: If Form 6251, line 30, is zero, do not complete this worksheet.
1. Enter the amount from Form 6251, line 30 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.
2. Enter the amount from your (and your spouse's if filing jointly) Form 2555, lines 45 and 50, or Form 2555-EZ,
line 18 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.
3. Add lines 1 and 2. Enter the result here and on Form 6251, line 36 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.
4. Tax on the amount on line 3.
If you reported capital gain distributions directly on Form 1040, line 13; or you reported qualified
dividends on Form 1040, line 9b; or you had a gain on both lines 15 and 16 of Schedule D (Form 1040),
enter the amount from line 3 of this worksheet on Form 6251, line 36. Complete the rest of Part III of Form
6251. However, before completing Part III, see Forms 2555 and 2555-EZ, later, to see if you must complete 4.
Part III with certain modifications. Then enter the amount from Form 6251, line 54, here.
All others: If line 3 is $175,000 or less ($87,500 or less if married filing separately), multiply line 3 by 26%
(.26). Otherwise, multiply line 3 by 28% (.28) and subtract $3,500 ($1,750 if married filing separately) from
5. Tax on the amount on line 2. If line 2 is $175,000 or less ($87,500 or less if married filing separately), multiply
line 2 by 26% (.26). Otherwise, multiply line 2 by 28% (.28) and subtract $3,500 ($1,750 if married filing
separately) from the result. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.
6. Subtract line 5 from line 4. Enter the result here and on Form 6251, line 31. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.
-10- Instructions for Form 6251 (2012)
Step 2. If you previously made or are results on line 1a of the applicable AMT gains or losses (as refigured for the
making the simplified limitation election, Form 1116. AMT) in no more than two separate
skip Part I and enter on the AMT Form You adjust your foreign source categories and any of the following
1116, line 17, the same amount you qualified dividends taxed at the 0% rate apply.
entered on that line for the regular tax. If by not including them on line 1a. You are not required to make
you did not complete Form 1116 for the Amounts taxed at the 0% rate are on adjustments to your foreign source
regular tax and you previously made or line 11 of the Qualified Dividends and qualified dividends under the rules
are making the simplified limitation Capital Gain Tax Worksheet in the Form described earlier (or you would not be
election, complete Part I and lines 15 1040 instructions, line 9 of the Qualified required to make those adjustments if
through 17 of the AMT Form 1116 using Dividends and Capital Gain Tax you had foreign source qualified
regular tax amounts. Worksheet in the Form 1040NR dividends).
instructions, or line 20 of the Line 15 or 16 of the AMT Schedule D
If the election does not apply,
Schedule D Tax Worksheet. (Form 1040) is zero or a loss.
complete Part I using only income and
deductions that are allowed for the AMT On the AMT Qualified Dividends and
Do not adjust the amount of Capital Gain Tax Worksheet in the Form
and attributable to sources outside the any foreign source qualified
United States. If you have any foreign ! dividends you elected to
1040 instructions, (a) line 3 of that
source qualified dividends or foreign
worksheet minus the amount on Form
include on line 4g of AMT Form 4952. 4952, line 4e, that you elected to include
source capital gains (including any
foreign source capital gain distributions) on Form 4952, line 4g, is zero or less,
Individuals with capital gain (b) line 7 of that worksheet is zero, or (c)
or losses, use the instructions under distributions only. If you have no
Step 3 to determine whether you must line 17 of that worksheet is equal to or
capital gains or losses other than capital greater than line 18.
make adjustments to those amounts gain distributions from box 2a of
before you include the amounts on On the AMT Qualified Dividends and
Form(s) 1099-DIV or substitute Capital Gain Tax Worksheet in the Form
line 1a or line 5 of the AMT Form 1116. statement(s), you must adjust your 1040NR instructions, (a) line 3 of that
Step 3. Follow the instructions below, if foreign source capital gain distributions worksheet is zero, (b) line 5 of that
applicable, to determine the amount of if you are required to adjust your foreign worksheet is zero, or (c) line 15 of that
foreign source qualified dividends, source qualified dividends under the worksheet is equal to or greater than
capital gain distributions, and other rules just described or you would be line 16.
capital gains and losses to include on required to adjust your foreign source
On the AMT Schedule D Tax
line 1a and line 5 of the AMT Form qualified dividends if you had any.
Worksheet (Form 1040), (a) line 18 is
1116. To adjust your foreign source capital zero, (b) line 9 is zero or less, or (c)
gain distributions, multiply your foreign line 35 is equal to or greater than
Foreign qualified dividends. You
source capital gain distributions in each line 36.
must adjust your foreign source
separate category by 0.5357 if the
qualified dividends before you include Use Worksheet B if you:
foreign source capital gain distributions
those amounts on line 1a of the AMT Cannot use Worksheet A,
are taxed at a rate of 15%. Include the
Form 1116 if: Have foreign source capital gains and
results on line 1a of the applicable AMT
Line 52 of Form 6251 is smaller than Form 1116. losses in no more than two separate
line 53, and categories,
Line 41 of Form 6251 is greater than You adjust your foreign source Did not have any item of
zero. capital gain distributions taxed at the 0% unrecaptured section 1250 gain or 28%
rate by not including them on line 1a. rate gain or loss for the AMT, and
But you do not need to make any Amounts taxed at the 0% rate are on
adjustments if: Do not have any capital gains taxed
line 11 of the Qualified Dividends and at a rate of 0%.
You qualify for the adjustment Capital Gain Tax Worksheet in the Form
exception under Qualified Dividends 1040 instructions, line 9 of the Qualified Instructions for Worksheets A and
and Capital Gain Tax Worksheet Dividends and Capital Gain Tax B. When you complete Worksheet A or
(Individuals) or Adjustments to foreign Worksheet in the Form 1040NR Worksheet B, use foreign source capital
qualified dividends under Schedule D instructions, or line 20 of the gains and losses, as refigured for the
Filers in the Form 1116 instructions, and Schedule D Tax Worksheet. AMT if necessary, and do not use any
Line 41 of Form 6251 is not more foreign source capital gains you elected
than $175,000 ($87,500 if married filing Do not adjust the amount of to include on line 4g of AMT Form 4952.
separately). ! any foreign source capital gain If you are required to complete a
CAUTION distributions you elected to Schedule D for the AMT, use line 16 of
Note. Use your capital gains and include on line 4g of AMT Form 4952. that AMT Schedule D to complete line 3
losses as refigured for the AMT to of Worksheet A or line 4 of the Line 2
determine whether your total amounts Individuals with other capital
Worksheet for Worksheet B. Use
are less than the $20,000 threshold gains or losses. If any capital gain or
0.5357 instead of 0.4286 to complete
under the adjustment exception. loss is different for the AMT, use
lines 11, 13, and 15 of Worksheet B and
To adjust your foreign source amounts as refigured for the AMT to
to complete lines 8, 11, and 17 of the
qualified dividends, multiply your foreign complete this step. Use Worksheet A in
Line 15 Worksheet for Worksheet B.
source qualified dividends in each the instructions for Form 1116 to
determine the adjustments you must If you do not qualify to use
separate category by 0.5357 if the Worksheet A or Worksheet B, use the
foreign source qualified dividends are make to your foreign source capital
gains or losses (as refigured for the instructions for Capital Gains and
taxed at a rate of 15%. Include the Losses in Pub. 514 to determine the
AMT) if you have foreign source capital
adjustments you make.
Instructions for Form 6251 (2012) -11-
Step 4. Complete Part II and lines 9 7. Enter the amount from Form Form 1040NR. If you are filing Form
through 14 of the AMT Form 1116. Use 6251, line 47, on line 8 of the worksheet. 1040NR, enter the tax from Form
your AMTFTC carryover, if any, on 8. Complete lines 9 and 10 of the 1040NR, line 42 (minus any tax from
line 10. worksheet as instructed on the Form 4972, Tax on Lump-Sum
worksheet. Distributions, and any foreign tax credit
Step 5. If the simplified limitation
from Form 1040NR, line 45). If you used
election does not apply, complete lines Step 7. Enter the amount from Form Schedule J to figure your tax, the
15 through 17 of the AMT Form 1116. 6251, line 31, on the AMT Form 1116, amount on line 42 of Form 1040NR
Step 6. If you did not complete Part III line 20. Complete lines 19, 21, and 22 of must be refigured without using
of Form 6251, enter the amount from the AMT Form 1116. Schedule J (see preceding paragraph).
line 28 of Form 6251 on line 18 of the Step 8. Complete Part IV of the first
AMT Form 1116 and go to Step 7. If you AMT Form 1116 only. Part III—Tax Computation
completed Part III of Form 6251, you
must complete, for the AMT, the Enter on Form 6251, line 32, the
Using Maximum Capital
Worksheet for Line 18 in the Form 1116 amount from line 30 of the first AMT Gains Rates
instructions to determine the amount to Form 1116.
Lines 37, 38, and 39
enter on line 18 of the AMT Form 1116
Attach to your tax return, after Form You generally can fill out lines 37, 38,
6251, all AMT Forms 1116 you used to and 39 using the amounts from the
Line 52 of Form 6251 is smaller than figure your AMTFTC. But do not attach
line 53, and Qualified Dividends and Capital Gain
AMT Forms 1116 if your AMTFTC is the Tax Worksheet or the Schedule D Tax
Line 41 of Form 6251 is greater than same as your regular tax foreign tax
zero. Worksheet, whichever applies, and
credit. Schedule D (Form 1040), if you
But you do not need to complete the completed Schedule D. But do not use
Worksheet for Line 18 if: AMTFTC Carryback and those amounts if any of the following
You qualify for the adjustment statements apply.
exception under Qualified Dividends
If your AMTFTC is limited, the unused 1. The gain or loss from any
and Capital Gain Tax Worksheet
amount generally may be carried back transaction reported on Form 8949 or
(Individuals) or Adjustments to foreign
or forward according to section 904(c). Schedule D is different for the AMT (for
qualified dividends under Schedule D
However, if you made the election to example, because of a different basis
Filers in the Form 1116 instructions, and
claim the foreign tax credit on Form for the AMT due to depreciation
Line 41 of Form 6251 is not more
1040 (or Form 1040NR) without filing adjustments, an incentive stock option
than $175,000 ($87,500 if married filing
Form 1116, any unused AMTFTC adjustment, or a different AMT capital
cannot be carried back or forward. In loss carryover from 2011).
Note. Use your capital gains and addition, no unused AMTFTC from 2. You did not complete either the
losses as refigured for the AMT to another year can be used in any year for Qualified Dividends and Capital Gain
determine whether your total amounts which the election has been made. Tax Worksheet or the Schedule D Tax
are less than the $20,000 threshold Worksheet because Form 1040, line 43
under the adjustment exception. Simplified Limitation Election (or Form 1040NR, line 41), is zero.
If you do not need to complete the You may elect to use a simplified 3. You received a Schedule K-1
Worksheet for Line 18, enter the amount section 904 limitation to figure your (Form 1041) that shows an amount in
from line 28 of Form 6251 on line 18 of AMTFTC. If you do, use your regular tax box 12 with code B, C, D, E, or F. If this
the AMT Form 1116. income for Form 1116, Part I, instead of applies, see Beneficiaries of estates or
refiguring your foreign source income trusts. Then read the following
Instructions for AMT Worksheet instructions.
for Line 18. Follow these steps to for the AMT, as described earlier. You
complete, for the AMT, the Worksheet must make the election for the first tax If (1) applies, complete an AMT Form
for Line 18 in the Form 1116 year after 1997 for which you claim an 8949. Next, if (1) or (3) applies,
instructions. AMTFTC. If you do not make the complete lines 1 through 20 of an AMT
election for that year, you may not make Schedule D. Then, if (1), (2), or (3)
1. Enter the amount from Form
it for a later year. Once made, the applies, complete lines 2 through 6 of
6251, line 28, on line 1 of the worksheet.
election applies to all later tax years and an AMT Qualified Dividends and Capital
2. Skip lines 2 and 3 of the may be revoked only with IRS consent. Gain Tax Worksheet or lines 2 through
worksheet. 13 of an AMT Schedule D Tax
3. Enter the amount from Form
Worksheet, whichever applies. (See
6251, line 50, on line 4 of the worksheet. If you used Schedule J, Income line 20 of your AMT Schedule D, if you
Averaging for Farmers and Fishermen, completed one, to determine which
4. Multiply line 4 of the worksheet by
to figure your tax on Form 1040, line 44 worksheet applies.) Complete line 5 of
0.1071 (instead of 0.2857). Enter the
(or Form 1040NR, line 42), you must the AMT Qualified Dividends and
result on line 5 of the worksheet.
refigure that tax (including any tax from Capital Gain Tax Worksheet or lines 3
5. Enter the amount from Form Form 8814) without using Schedule J and 4 of the AMT Schedule D Tax
6251, line 48, on line 6 of the worksheet. before completing this line. This is only Worksheet, whichever applies, using
6. Multiply line 6 of the worksheet by for Form 6251; do not change the your AMT Form 4952. Use amounts
0.4643 (instead of 0.5714). Enter the amount on Form 1040, line 44 (or Form from Schedule D or the AMT
result on line 7 of the worksheet. 1040NR, line 42). Schedule D, whichever applies, and
either the AMT Qualified Dividends and
-12- Instructions for Form 6251 (2012)
Capital Gain Tax Worksheet or the AMT 3. Reduce the amount on your AMT Schedule D (Form 1040), whichever
Schedule D Tax Worksheet, whichever Schedule D (Form 1040), line 18, (but applies (as refigured for the AMT, if
applies, to complete lines 37, 38, and 39 not below zero) by your capital gain necessary).
of Form 6251. Keep the AMT Form excess.
8949, AMT Schedule D, and the Line 42
4. Include your capital gain excess
applicable AMT worksheet for your as a loss on line 16 of your AMT If you are filing Form 1040NR and Form
records, but do not attach any of them to Unrecaptured Section 1250 Gain 6251, line 41, is $175,000 or less
your tax return. Worksheet in the Instructions for ($87,500 or less if you checked filing
Schedule D (Form 1040). status box 3, 4, or 5), multiply line 41 by
Note. Do not decrease your section 26% (.26). Otherwise, multiply line 41 by
1202 exclusion by the amount, if any, on Beneficiaries of estates or trusts. If 28% (.28) and subtract $3,500 ($1,750
line 13. you received a Schedule K-1 (Form if you checked filing status box 3, 4, or
1041) that shows an adjustment in 5) from the result.
Forms 2555 and 2555-EZ. If you are
filing either of these forms and you have box 12, follow the instructions in the Line 43
a capital gain excess, you must following table.
If you are filing Form 1040NR, enter
complete Part III of Form 6251 with $35,350 ($70,700 if you checked filing
certain modifications. To see if you have IF the code in THEN include that
status box 6).
a capital gain excess, subtract Form box 12 is... adjustment in figuring the
6251, line 30, from line 6 of your AMT amount on... Line 44
Qualified Dividends and Capital Gain B line 2 of an AMT Qualified If you are filing Form 1040NR, enter on
Tax Worksheet (or line 10 of your AMT Dividends and Capital Gain Form 6251, line 44, the amount from
Schedule D Tax Worksheet). If the Tax Worksheet or an AMT line 5 of the Qualified Dividends and
result is greater than zero, that amount Schedule D Tax Worksheet,
Capital Gain Tax Worksheet in the
is your capital gain excess. whichever applies.
instructions for Form 1040NR, line 42,
If you have capital gain excess, figure C line 5, column (h), of an AMT or the amount from line 14 of the
the amounts to enter on lines 37, 38, Schedule D. Schedule D Tax Worksheet in the
and 39 of Form 6251 using the following D line 12, column (h), of an instructions for Schedule D (Form
modifications (only for purposes of Part AMT Schedule D. 1040), whichever applies (as figured for
III of Form 6251). E line 11 of an AMT the regular tax). If you did not complete
1. Reduce the amount you would Unrecaptured Section 1250 either worksheet for the regular tax,
otherwise enter on line 3 of your AMT Gain Worksheet. enter -0-.
Qualified Dividends and Capital Gain F line 4 of an AMT 28% Rate Line 53
Tax Worksheet or line 9 of your AMT Gain Worksheet.
If you are filing Form 1040NR and Form
Schedule D Tax Worksheet (but not
6251, line 36, is $175,000 or less
below zero) by your capital gain excess. Form 1040NR. If you are filing Form ($87,500 or less if you checked filing
2. Reduce the amount you would 1040NR, enter on Form 6251, line 37, status box 3, 4, or 5), multiply line 36 by
otherwise enter on line 2 of your AMT the amount from line 4 of the Qualified 26% (.26). Otherwise, multiply line 36 by
Qualified Dividends and Capital Gain Dividends and Capital Gain Tax 28% (.28) and subtract $3,500 ($1,750
Tax Worksheet or line 6 of your AMT Worksheet in the instructions for Form if you checked filing status box 3, 4, or
Schedule D Tax Worksheet (but not 1040NR, line 42, or the amount from 5) from the result.
below zero) by any of your capital gain line 13 of the Schedule D Tax
excess not used in (1). Worksheet in the instructions for
Instructions for Form 6251 (2012) -13-