Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
AMT
Old 02-14-2007, 08:33 PM   #1
Recycles dryer sheets
 
Join Date: Oct 2006
Posts: 92
AMT

This is a new one for me. I put some money into the VG tax exempt money market fund. On the 1099, there is an entry for $242.63 of interest from specified private activity bonds exempt from regular tax. I started researching to see what that is, and it looks like it means we have to fill out form 6251 to see if we owe the AMT. Is that correct?
__________________

__________________
AlmostDone is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Re: AMT
Old 02-14-2007, 08:37 PM   #2
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Jun 2005
Posts: 8,616
Re: AMT

Only a small percentage of folks fill out forms anymore. The vast majority of folks use a tax software program which will check for AMT for you. So the answer to your question is no, you do not have to fill out form 6251. Let TurboTax or some other program do it for you.
__________________

__________________
LOL! is offline   Reply With Quote
Re: AMT
Old 02-14-2007, 08:55 PM   #3
Thinks s/he gets paid by the post
 
Join Date: Jul 2005
Posts: 3,862
Re: AMT

I've never had to worry about this personally, but not all tax-free funds are AMT tax free. So you may very well have to include some of that as income for AMT. A few funds do specify that they are AMT tax-free as well.

Dan
__________________
Animorph is offline   Reply With Quote
Re: AMT
Old 02-14-2007, 08:57 PM   #4
Thinks s/he gets paid by the post
retire@40's Avatar
 
Join Date: Feb 2004
Posts: 2,670
Re: AMT

Quote:
Originally Posted by LOL!
Only a small percentage of folks fill out forms anymore. The vast majority of folks use a tax software program which will check for AMT for you. So the answer to your question is no, you do not have to fill out form 6251. Let TurboTax or some other program do it for you.
And then the next question is, "Did the software give me the correct answer?"
__________________
No man is free who is not master of himself. --- Epictetus
Enjoy Yourself (It's Later Than You Think). --- Guy Lombardo
retire@40 is offline   Reply With Quote
Re: AMT
Old 02-14-2007, 08:58 PM   #5
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
audreyh1's Avatar
 
Join Date: Jan 2006
Location: Rio Grande Valley
Posts: 16,457
Re: AMT

That's right. $243 is not much, and unless something else is causing you to pay AMT, you probably won't owe taxes on that money. But the only way to know is to fill out form 6521.

As LOL said, if you are using a tax program, it is probably already doing that check for you provided you know exactly where to enter that number.

If it's Turbotax pull up form 6521 and see if the entry is there for "private activity bond interest" - sorry I don't which line, but it should be on the first page of the form.

Audrey

__________________
Well, I thought I was retired. But it seems that now I'm working as a travel agent instead!
audreyh1 is online now   Reply With Quote
Re: AMT
Old 02-14-2007, 09:31 PM   #6
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Jun 2005
Posts: 8,616
Re: AMT

Quote:
Originally Posted by retire@40
And then the next question is, "Did the software give me the correct answer?"
Well, I think that's better than the questions "Did I give me the correct answer?" or even "Did my tax professional give me the correct answer?"
__________________
LOL! is offline   Reply With Quote
Re: AMT
Old 02-15-2007, 01:50 AM   #7
Thinks s/he gets paid by the post
 
Join Date: Jul 2005
Location: Los Angeles area
Posts: 1,432
Re: AMT

Quote:
Originally Posted by AlmostDone
This is a new one for me. I put some money into the VG tax exempt money market fund. On the 1099, there is an entry for $242.63 of interest from specified private activity bonds exempt from regular tax. I started researching to see what that is, and it looks like it means we have to fill out form 6251 to see if we owe the AMT. Is that correct?
Private activity munis count towards AMT income, even though they do not
count towards AGI for regular federal tax. This does not mean you owe AMT,
just that you are more likely to (or will owe a bit more if you are already in
the AMT zone)
__________________
learn, work, save, invest, fire
CyclingInvestor is offline   Reply With Quote
Re: AMT
Old 02-15-2007, 11:06 AM   #8
Recycles dryer sheets
 
Join Date: Oct 2006
Posts: 92
Re: AMT

Thank you all. The $242.63 would be the only reason to fill out the form. I guess I'll fill it out to have the experience.
__________________
AlmostDone is offline   Reply With Quote
Re: AMT
Old 02-15-2007, 09:52 PM   #9
Recycles dryer sheets
 
Join Date: Dec 2006
Posts: 162
Re: AMT

Technically everyone could owe AMT. The tax system is basically two tiered: regular rates and AMT. You are supposed to calculate your taxes both ways and pay the higher of the 2. As was said already, the $242 will not change it much, but if you are in the AMT range, this amount will be added to your income and be taxed at 26%, when it otherwise would have been tax free.

Some of the major triggers for AMT are taxes (state and local income tax and property tax) and personal exemptions. This are added back to your income for the AMT calculation.
__________________

__________________
firewhen is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
I'm in AMT Hell - anyone understand how to recover AMT Credit from ISO exercise? JB FIRE and Money 4 04-14-2007 10:39 AM
Capital Losses and AMT Delawaredave FIRE and Money 2 02-20-2007 05:32 AM
AMT is getting too close .... Help plattj1 FIRE and Money 5 05-02-2006 09:33 AM
amt & homesteaded property lazygood4nothinbum FIRE and Money 13 04-02-2006 01:51 PM
AMT Information cube_rat Young Dreamers 22 11-11-2005 08:36 AM

 

 
All times are GMT -6. The time now is 03:55 PM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.