Problem: Wolfgang's AGI is $140,000. He has the following itemized deductions for 2007:
Medical expenses [$12,000 - (7.5% x $140,000)] $1,500
State income taxes $4,200
Charitable contributions $5,000
Home mortgage interest on his personal residence $6,500
Casualty loss (after $100 and 10% reductions) $1,800
Miscellaneous itemized deductions
[$3,500-2%($140,000)] 700
_________
$19,700
1) Calculate Wolfgang's itemized deductions for AMT purposes
2) What is the amount of the AMT adjustment.