Regular Tax and AMT Calculations. Sheldon Corporation reports taxable income of $150,000 for its second tax year. Its regular tax liability is $41,750. The following facts were taken into account in deriving taxable income.
a) Used equipment is depreciated under MACRS. The amount of MACRS depreciation claimed is $90,000. Depreciation for AMT purposes in its second tax year is $60,000.
b) The corporation includes in taxable income a $12,000 gain on the sale of equipment. The regular tax basis at the time of sale is $9,000 less than its AMT basis.
c) Sheldon's adjusted current earnings is $340,000.
d) Sheldon has no AMT adjustment for the U.S. production activities deduction.
No NOL, Capital loss, or tax credit carryovers from the first year of operation are available for use in the second year.
a. What is Sheldon's AMT liability?
b. Is any minimum tax credit carryback or carryover available? If so, to what years?"