Instructions For Form 6251 - Alternative Minimum Tax-Individuals

Line 20—Loss Limitations

loss for the AMT of $3,400. You then

How Is the AMT Class Life

enter this amount on the AMT Form

Determined?

To avoid duplication, any AMT

8582 and refigure the allowable passive

The class life used for the AMT isn’t

adjustment or tax preference

activity loss for the AMT.

item taken into account on this

necessarily the same as the recovery

CAUTION

The amount of any AMT

line shouldn’t be taken into account in

period used for the regular tax. The

passive activity loss that isn’t

figuring the amount to enter on any

class lives for the AMT are listed in Rev.

TIP

deductible and is carried

other adjustment or tax preference item

Proc. 87-56, 1987-2 C.B. 674, and in

forward is likely to differ from the regular

line of this form.

Pub. 946, How To Depreciate Property.

tax amount, if any. Therefore, keep

Use 12 years for any tangible personal

For passive activities, see the line 19

adequate records for both the AMT and

property not assigned a class life.

instructions instead. For tax shelter farm

regular tax.

See Pub. 946 for tables that can

activities (that are not passive), see the

be used to figure AMT

line 27 instructions.

Enter the difference between the

TIP

depreciation. Rev. Proc. 89-15,

amount that would be reported for the

Refigure your gains and losses from

1989-1 C.B. 816, has special rules for

activity on Schedule C, C-EZ, E, or F or

activities for which you aren’t at risk and

short years and for property disposed of

Form 4835, Farm Rental Income and

basis limitations applicable to

before the end of the recovery period.

Expenses, for the AMT and the regular

partnerships and S corporations by

tax amount. If (a) the AMT loss is more

taking into account all AMT adjustments

than the regular tax loss, (b) the AMT

How Is the Adjustment Figured?

and preferences that apply. See

gain is less than the regular tax gain, or

sections 59(h), 465, 704(d), and

Subtract the AMT deduction for

1366(d).

depreciation from the regular tax

tax gain, enter the adjustment as a

deduction and enter the result. If the

negative amount.

Enter the difference between the

AMT deduction is more than the regular

Enter any adjustment for amounts

amount that would be reported for the

tax deduction, enter the difference as a

reported on Form 8949, Schedule D,

activity on Schedule C, C-EZ, E, or F or

negative amount.

Form 4835 for the AMT and the regular

Form 4684, or Form 4797 for the activity

tax amount. If (a) the AMT loss is more

on line 17 instead of line 19. See the

In addition to the AMT adjustment to

than the regular tax loss, (b) the AMT

instructions for line 17.

your deduction for depreciation, also

gain is less than the regular tax gain, or

adjust the amount of depreciation that

Publicly Traded Partnership (PTP)

was capitalized, if any, to account for

tax gain, enter the adjustment as a

the difference between the rules for the

If you had a loss from a PTP, refigure

negative amount.

regular tax and the AMT. Include on this

the loss using any AMT adjustments

line the current year adjustment to

The AMT amount of any gain or

and preferences and any AMT prior

taxable income, if any, resulting from

loss from activities for which you

year unallowed loss.

TIP

the difference.

aren’t at risk is likely to differ

from the regular tax amount. Your AMT

Line 19—Passive Activities

Tax Shelter Passive Farm

basis in partnerships and S corporations

Activities

Refigure your passive activity gains and

is also likely to differ from your regular

losses for the AMT by taking into

Refigure any gain or loss from a tax

tax basis. Therefore, keep adequate

account all adjustments and

shelter passive farm activity taking into

records for both the AMT and regular

preferences and any AMT prior year

account all AMT adjustments and

tax.

unallowed losses that apply to that

preferences and any AMT prior year

activity. You may fill out an AMT Form

unallowed losses. If the amount is a

Enter any adjustment for amounts

8582, Passive Activity Loss Limitations,

gain, include it on the AMT Form 8582.

reported on Form 8949, Schedule D,

and AMT versions of the other forms or

If the amount is a loss, don’t include it

Form 4684, or Form 4797 for the activity

schedules on which your passive

on the AMT Form 8582. Carry the loss

on line 17 instead of line 20.

activities are reported, to determine

forward to 2018 to see if you have a

your passive activity loss allowed for the

Line 21—Circulation Costs

gain or loss from tax shelter passive

AMT, but don’t file the AMT versions of

farm activities for 2018.

Don’t make this adjustment for

these forms and schedules with your tax

costs for which you elected the

return. Instead, keep them with your

Insolvency

optional 3-year write-off for the

records.

CAUTION

regular tax.

If at the end of the tax year your

Example. You are a partner in a

liabilities exceed the fair market value of

partnership and the Schedule K-1 (Form

Circulation costs (expenditures to

your assets, increase your passive

1065) you received shows the following.

establish, maintain, or increase the

activity loss allowed by that excess (but

A passive activity loss of $4,125.

circulation of a newspaper, magazine,

not by more than your total loss). See

A depreciation adjustment of $500 on

or other periodical) deducted in full for

section 58(c)(1).

post-1986 property.

the regular tax in the year they were

paid or incurred must be capitalized and

An adjustment of $225 on the

amortized over 3 years for the AMT.

disposition of property.

Enter the difference between the regular

Because the two adjustments above

tax and AMT deduction. If the AMT

are from the passive activity and aren’t

deduction is more than the regular tax

allowed for the AMT, you must first

deduction, enter the difference as a

reduce the passive activity loss by those

negative amount.

amounts. The result is a passive activity

Instructions for Form 6251 (2017)

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Instructions For Form 6251 - Alternative Minimum Tax-Individuals - 2017 Page 7

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