Calculating AMT

[mslatinlady]

I live in California.   I use Turbotax Deluxe CD.   QUESTION:  Will Turbotax figure out whether I owe AMT or not (Alternative Minimum Tax)  ?  (I was reading about AMT and it's very confusing).  THANKS AND LET ME KNOW!!  Blessings to all who can answer this question !

[Mike9241]

some parts will be automatic from other entries. other questions you will have to answer correctly. no different than other items on your return.

[mslatinlady]

I don't quite understand your answer.  Can you please explain it a little more?  Thanks and blessings !

[ThomasM125]

There is a section in TurboTax for the Alternative Minimum Tax (AMT). It is in the Other Tax Situations section. You need to go through that section if you are concerned about paying alternative minimum tax, as there may be some entries that you may have to make to insure that it is calculated properly.

You only need to complete the section if you took the standard deduction on your tax return, deducted state taxes or exercised or sold incentive stock options. Otherwise, TurboTax will calculate your AMT based on the entries you have already made in your program.

[mslatinlady]

I entered all information in my return. Yes, I entered my itemized deductions, but Turbotax told me that the Standard Deduction was best for me. Then the “Other Tax Situations” page popped up. So if Turbotax is supposed to calculate whether I am subject to AMT, why didn’t it just go ahead and calculate whether AMT applies to me it PRIOR to that AMT section on Other Tax Situations ?  Shouldn’t Turbotax let me know whether my total income falls below the AMT threshold for the tax year prior to this? Because once I opened up the Other Tax Situation AMT section, my total income showed up but there was a little trash can icon next to it so I didn’t know what to do, whether to just bypass this section or click on the little trash can. I had to go to the IRS website to ask “what is the income amount that triggers AMT”.   I learned that the AMT for a single filer for 2021 is triggered once the total income exceeds $73,600.  So since my total income is below this, I figured that the AMT does not apply to me. I ran into this problem last year as well. So basically, shouldn’t Turbotax let me know whether I’m subject to AMT prior to getting to that AMT question??   That little trash can next my to my income is very confusing for us users……

Thanks and blessings…

[RobertB4444]

@mslatinlady  There are very few instances where AMT kicks in when one doesn't itemize deductions.  And none of them kick in for someone making less than $73,600 a year.  So TurboTax would have known that the AMT did not apply to you and ignored the AMT section entirely.  

[mslatinlady]

To RobertB4444

But when I was wrapping up the Income section, the Turbotax program said:  Now Let's See If These Other Income Questions Apply to You.  And then the first section was AMT, so when I clicked on it to walk through it, it just showed me my income amount and then a little trash can on the right hand side.  I therefore didn't know what Turbotax wanted me to do because there were nothing instructing me on what to do.  I didn't click on the trash can to delete it.  I just backed out of that section.  I think at this screen Turbotax should have a statement pop up telling me that because of my income amount, I don't owe any AMT.  This was so confusing until I went to the IRS website to find out that AMT applies when a single filer's income exceeds $73,600 for tax year 2021.   All I'm saying is that Turbotax should makek this AMT section easier for the user to understand.  What do you think?

Blessings...

[stevedhoward]

I agree, this is astonishingly difficult.  I *know* I have to calculate AMT due to the exercise of ISO options, and the ability to locate where to indicate that is obtuse, and that is being generous.  I have entered the AMT section, and nowhere is the phrase ISO to be found, other than in search results to pages such as this.  There is an investment adjustment option, but nowhere to simply say I exercised X shares with a market value $Y dollars and an exercise price of $Z per share.  Form 6251 points only to messages such as this in the help section.  The information is not on the 1099-B, so I expect to enter it, but am so weary of looking where to do so that I am going to look at an alternative solution like H&R Block.  Unbelievable.