Problem- The following additional information is available for the Dr. Ivan and Irene Incisor family from Chapters 1-5.
Ivan's grandfather died and left a portfolio of municipal bonds. In 2015, they pay Ivan $80,000 in tax-free interest. Since the bonds are private activity bonds, the $80,000 is a tax preference for purposes of the AMT. Assume for Chapters 6, 7, and 8 that Ivan's federal income tax withholding from his wages is $12,000, not $6,000.
Required: Combine this new information about the Incisor family with the information from Chapters 1-5 and complete a revised 2015 tax return for Ivan and Irene. Be sure to save your data input files since this case will be expanded with more fax information in later chapters.
Please note: This problem requires the calculation of AMT. The home equity interest of $900 on the purchase of an automobile is not deductible for AMT (see line 4 of Form 6251). Please also note that Page 2 of Form 6251 must be filled in to calculate the lower AMT amount on qualified dividends and that the Saver's Credit still applies.