What is the maximum alternative minimum tax (AMT) exemption amount for a head of household with an AMT income of $179,000?

What is the maximum alternative minimum tax (AMT) exemption amount for a head of household with an AMT income of $179,000?

• A. $45,895
• B. $63,481
• C. $73,748
• D. $91,793

Answer: (B)

The maximum alternative minimum tax (AMT) exemption amount for a head of household is set annually by the IRS and varies based on filing status and income levels. For the given scenario, the exemption amount for a head of household with an AMT income of $179,000 falls under the phase-out range. For 2023, the full exemption amount for a head of household is $63,481. However, the AMT exemption begins to phase out at higher levels of income. The phase-out reduction occurs when the taxpayer's AMT income exceeds a certain threshold. For head of household, this threshold is typically around $1,000,000, providing a full exemption until reaching this point. In the case presented, an AMT income of $179,000 is below the phase-out threshold, allowing the taxpayer to receive the full exemption amount. Therefore, the $63,481 figure is the correct maximum exemption available for this filing status at the specified income level.

The maximum alternative minimum tax (AMT) exemption amount for a head of household is set annually by the IRS and varies based on filing status and income levels. For the given scenario, the exemption amount for a head of household with an AMT income of $179,000 falls under the phase-out range.

For 2023, the full exemption amount for a head of household is $63,481. However, the AMT exemption begins to phase out at higher levels of income. The phase-out reduction occurs when the taxpayer's AMT income exceeds a certain threshold. For head of household, this threshold is typically around $1,000,000, providing a full exemption until reaching this point.

In the case presented, an AMT income of $179,000 is below the phase-out threshold, allowing the taxpayer to receive the full exemption amount. Therefore, the $63,481 figure is the correct maximum exemption available for this filing status at the specified income level.