This year for the first time, I have to attach the alternative minimum tax form 6251 with AMT FTC form 1116 to bring down the AMT below the regular tax so that I'm not subject to AMT.
In previous years, I only attached regular form 1116, and never filed 6251 or AMT version of 1116, as the AMTI (simply equals AGI) was always far below the AMT exemption amount.
Can I include carryover of AMT FTC from previous years (equals the full amount of foreign taxes from the regular 1116), on line 10 of AMT 1116 this year, or would I have had to attached AMT 1116 to the previous years' tax returns to be able to carryover the AMT FTC?
I could only find this text in the IRS process unit INT-P-062:
- "Please note that even if taxpayers are not ultimately subject to AMT, a record of the computation of AMT FTC is necessary for potential carryback and carryforward purposes."
- "Criteria: Have taxpayers maintained a record of their AMT FTC calculation for carryover purposes even in years in which they are not otherwise liable for AMT?"
- "CAUTION: Creditable foreign taxes can be carried over from taxable years in which the taxpayer was not otherwise subject to the AMT. In order to correctly determine the carryover amount, the taxpayer must fully calculate the AMT FTC for those years despite the fact they are not otherwise subject to the AMT."
But does it mean keeping the records to myself, or having to file an AMT FTC 1116 in every year that I want to carryover unused foreign taxes from?
I was thinking to write in lines 3 of AMT version of Schedule B 1116:
- c. AMTI below exemption, all foreign taxes from regular f1116 part II are unused for AMT FTC
And then simply entering the full amount of foreign taxes into the appropriate column for each of the past years. But I don't know if this is acceptable?
I think even without the AMT FTC carryovers from the previous years, the used AMT FTC in future years should generally be much lower than the regular FTC, so the unused AMT FTC would simply accumulate forever. But in the off chance that extra carryover is needed, it would be nice to have.
I also have a regular overall domestic loss account from past years (where the sum total of line 19 from all forms 1116 exceed a ratio of 1.0). This year I need to recapture a portion of the loss account by adding some of it to line 16 adjustments, because the ratio is below 1.0 this year.
Should I also recalculate an AMT version of the domestic loss account from all of my past years and add them to the AMT FTC 1116, even if this year is the first time I'm attaching the forms for AMT?
Edit: regarding overall domestic loss account, I think there would not be any AMT version of overall domestic loss, since foreign source income should normally not exceed worldwide income without factoring in any deductions.
