777 / How is the alternative minimum tax calculated?

In 2025, the 28 percent rate applies to excess taxable income above $119,550 for married taxpayers filing separately and $239,100 for all other noncorporate taxpayers.

In 2024, the 28 percent rate applies to excess taxable income above $116,300 for married taxpayers filing separately and $232,600 for all other noncorporate taxpayers.

In 2023, the 28 percent rate applied to excess taxable income above $110,350 for married taxpayers filing separately and $220,700 for joint returns, individual returns, and estate and trusts.

In 2022, the 28 percent rate applies to excess taxable income above $103,050 for married taxpayers filing separately and $206,100 for joint returns, individual returns, and estates and trusts.¹ The resulting amount is the taxpayer’s tentative minimum tax. The preferential tax rates on certain capital gains held for more than 12 months and certain dividends are also used when determining the taxpayer’s tentative minimum tax (see Q 702).²

If the tentative minimum tax reduced by the AMT foreign tax credit exceeds the regularly calculated tax (with adjustments) for the tax year, the excess is the AMT. Regularly calculated tax for AMT purposes excludes certain taxes including: (1) the alternative minimum tax; (2) the tax on benefits paid from a qualified retirement plan in excess of the plan formula to a 5 percent owner; (3) the 10 percent penalty tax for certain premature distributions from annuity contracts; (4) the 10 percent additional tax on certain early distributions from qualified retirement plans; (5) the 10 percent additional tax for certain taxable distributions from modified endowment contracts; (6) taxes relating to the recapture of the federal subsidy from use of qualified mortgage bonds and mortgage credit certificates; (7) the additional tax on certain distributions from education IRAs; and (8) the 15 percent additional tax on medical savings account distributions not used for qualified medical expenses. Regularly calculated tax is reduced by the foreign tax credit, the Puerto Rico and possession tax credit, and the Puerto Rico economic activity credit.³

For tax years from 2000 through 2011, certain nonrefundable personal credits (see Q 758) could be used to reduce the sum of a taxpayer’s regular tax liability and AMT liability. The American Taxpayer Relief Act of 2012 (“ATRA”) made the use of nonrefundable personal credits against the AMT permanent.⁴