Exam 17: Tax Credits and Corporate Alternative Minimum Tax

Keosha acquires used 10-year personal property to use in her business in 2017 and uses MACRS depreciation for regular income tax purposes.As a result, Keosha will incur a positive AMT adjustment in 2017, because AMT depreciation is slower.

Unused foreign tax credits can be carried back three years and forward fifteen years.

Eula owns a mineral property that had a basis of $23,000 at the beginning of the year.Cost depletion is $19,000.The property qualifies for a 15% depletion rate.Gross income from the property was $200,000, and net income before the percentage depletion deduction was $50,000.What is Eula's AMT preference for excess depletion, if she maximized her regular-tax depletion deduction?

During the year, Purple Corporation (a U.S.Corporation) has U.S.-source income of $1,800,000 and foreign income of $600,000.The foreign-source income generates foreign income taxes of $150,000.The U.S.income tax before the foreign tax credit is $816,000.Purple Corporation's foreign tax credit is: