26 USC 55 - Alternative minimum tax imposed

U.S Code last checked for updates: Jan 18, 2025

§ 55.

Alternative minimum tax imposed

(a)

General rule

There is hereby imposed (in addition to any other tax imposed by this subtitle) a tax equal to the excess (if any) of—

(1)

the tentative minimum tax for the taxable year, over

(2)

the regular tax for the taxable year plus, in the case of an applicable corporation, the tax imposed by section 59A.

(b)

Tentative minimum tax

For purposes of this part—

(1)

Noncorporate taxpayers

In the case of a taxpayer other than a corporation—

(A)

In general

The tentative minimum tax for the taxable year is the sum of—

(i)

26 percent of so much of the taxable excess as does not exceed $175,000, plus

(ii)

28 percent of so much of the taxable excess as exceeds $175,000.

The amount determined under the preceding sentence shall be reduced by the alternative minimum tax foreign tax credit for the taxable year.

(B)

Taxable excess

(C)

Married individual filing separate return

(D)

Alternative minimum taxable income

The term “alternative minimum taxable income” means the taxable income of the taxpayer for the taxable year—

(i)

determined with the adjustments provided in section 56 and section 58, and

(ii)

increased by the amount of the items of tax preference described in section 57.

If a taxpayer is subject to the regular tax, such taxpayer shall be subject to the tax imposed by this section (and, if the regular tax is determined by reference to an amount other than taxable income, such amount shall be treated as the taxable income of such taxpayer for purposes of the preceding sentence).

(2)

Corporations

(A)

Applicable corporations

In the case of an applicable corporation, the tentative minimum tax for the taxable year shall be the excess of—

(i)

15 percent of the adjusted financial statement income for the taxable year (as determined under section 56A), over

(ii)

the corporate AMT foreign tax credit for the taxable year.

(B)

Other corporations

(3)

Maximum rate of tax on net capital gain of noncorporate taxpayers

The amount determined under the first sentence of paragraph (1)(A) shall not exceed the sum of—

(A)

the amount determined under such first sentence computed at the rates and in the same manner as if this paragraph had not been enacted on the taxable excess reduced by the lesser of—

(i)

the net capital gain; or

(ii)

the sum of—

(I)

the adjusted net capital gain, plus

(II)

the unrecaptured section 1250 gain, plus

(B)

0 percent of so much of the adjusted net capital gain (or, if less, taxable excess) as does not exceed an amount equal to the excess described in section 1(h)(1)(B), plus

(C)

15 percent of the lesser of—

(i)

so much of the adjusted net capital gain (or, if less, taxable excess) as exceeds the amount on which tax is determined under subparagraph (B), or

(ii)

the excess described in section 1(h)(1)(C)(ii), plus

(D)

20 percent of the adjusted net capital gain (or, if less, taxable excess) in excess of the sum of the amounts on which tax is determined under subparagraphs (B) and (C), plus

(E)

25 percent of the amount of taxable excess in excess of the sum of the amounts on which tax is determined under the preceding subparagraphs of this paragraph.

Terms used in this paragraph which are also used in section 1(h) shall have the respective meanings given such terms by section 1(h) but computed with the adjustments under this part.

(c)

Regular tax

(1)

In general

(2)

Coordination with income averaging for farmers and fishermen

(3)

Cross references

(d)

Exemption amount

For purposes of this section—

(1)

Exemption amount for taxpayers other than corporations

In the case of a taxpayer other than a corporation, the term “exemption amount” means—

(A)

$78,750 in the case of—

(i)

a joint return, or

(ii)

a surviving spouse,

(B)

$50,600 in the case of an individual who—

(i)

is not a married individual, and

(ii)

is not a surviving spouse,

(C)

50 percent of the dollar amount applicable under subparagraph (A) in the case of a married individual who files a separate return, and

(D)

$22,500 in the case of an estate or trust.

For purposes of this paragraph, the term “surviving spouse” has the meaning given to such term by section 2(a), and marital status shall be determined under section 7703.

(2)

Phase-out of exemption amount

The exemption amount of any taxpayer shall be reduced (but not below zero) by an amount equal to 25 percent of the amount by which the alternative minimum taxable income of the taxpayer exceeds—

(A)

$150,000 in the case of a taxpayer described in paragraph (1)(A),

(B)

$112,500 in the case of a taxpayer described in paragraph (1)(B), and

(C)

50 percent of the dollar amount applicable under subparagraph (A) in the case of a taxpayer described in subparagraph (C) or (D) of paragraph (1).

In the case of a taxpayer described in paragraph (1)(C), alternative minimum taxable income shall be increased by the lesser of (i) 25 percent of the excess of alternative minimum taxable income (determined without regard to this sentence) over the minimum amount of such income (as so determined) for which the exemption amount under paragraph (1)(C) is zero, or (ii) such exemption amount (determined without regard to this paragraph).

(3)

Inflation adjustment

(A)

In general

In the case of any taxable year beginning in a calendar year after 2012, the amounts described in subparagraph (B) shall each be increased by an amount equal to—

(i)

such dollar amount, multiplied by

(ii)

the cost-of-living adjustment determined under section 1(f)(3) for the calendar year in which the taxable year begins, determined by substituting “calendar year 2011” for “calendar year 2016” in subparagraph (A)(ii) thereof.

(B)

Amounts described

The amounts described in this subparagraph are—

(i)

each of the dollar amounts contained in subsection (b)(1)(A),

(ii)

each of the dollar amounts contained in subparagraphs (A), (B), and (D) of paragraph (1), and

(iii)

each of the dollar amounts in subparagraphs (A) and (B) of paragraph (2).

(C)

Rounding

(4)

Special rule for taxable years beginning after 2017 and before 2026

(A)

In general

In the case of any taxable year beginning after December 31, 2017, and before January 1, 2026—

(i)

paragraph (1) shall be applied—

(I)

by substituting “$109,400” for “$78,750” in subparagraph (A), and

(II)

by substituting “$70,300” for “$50,600” in subparagraph (B),

(ii)

paragraph (2) shall be applied—

(I)

by substituting “$1,000,000” for “$150,000” in subparagraph (A),

(II)

by substituting “50 percent of the dollar amount applicable under subparagraph (A)” for “$112,500” in subparagraph (B), and

(III)

in the case of a taxpayer described in paragraph (1)(D), without regard to the substitution under subclause (I), and

(iii)

subsection (j) of section 59 shall not apply.

(B)

Inflation adjustment

(i)

In general

In the case of any taxable year beginning in a calendar year after 2018, the amounts described in clause (ii) shall each be increased by an amount equal to—

(I)

such dollar amount, multiplied by

(II)

the cost-of-living adjustment determined under section 1(f)(3) for the calendar year in which the taxable year begins, determined by substituting “calendar year 2017” for “calendar year 2016” in subparagraph (A)(ii) thereof.

(ii)

Amounts described

(iii)

Rounding

(iv)

Coordination with current adjustments

(Added and amended Pub. L. 99–514, title II, § 252(c), title VII, § 701(a), Oct. 22, 1986, 100 Stat. 2205, 2321; Pub. L. 100–647, title I, §§ 1002(l)(27), 1007(a), Nov. 10, 1988, 102 Stat. 3381, 3428; Pub. L. 101–508, title XI, §§ 11102(a), 11813(b)(5), Nov. 5, 1990, 104 Stat. 1388–406, 1388–551; Pub. L. 102–318, title V, § 521(b)(1), July 3, 1992, 106 Stat. 310; Pub. L. 102–486, title XIX, § 1913(b)(2)(D), Oct. 24, 1992, 106 Stat. 3020; Pub. L. 103–66, title XIII, § 13203(a)–(c)(1), Aug. 10, 1993, 107 Stat. 461, 462; Pub. L. 104–188, title I, §§ 1205(d)(6), 1401(b)(3), 1601(b)(2)(A), Aug. 20, 1996, 110 Stat. 1776, 1788, 1832; Pub. L. 105–34, title III, § 311(b)(1), (2)(A), title IV, § 401(a), title XVI, § 1601(f)(1)(C), Aug. 5, 1997, 111 Stat. 834, 835, 843, 1090; Pub. L. 105–206, title VI, §§ 6005(d)(2), 6006(a), July 22, 1998, 112 Stat. 804, 806; Pub. L. 107–16, title VII, § 701(a), (b), June 7, 2001, 115 Stat. 148; Pub. L. 108–27, title I, § 106(a), title III, § 301(a)(1), (2)(B), (b)(2), May 28, 2003, 117 Stat. 755, 758; Pub. L. 108–311, title I, § 103(a), title IV, § 406(d), Oct. 4, 2004, 118 Stat. 1168, 1189;

cite as: 26 USC 55