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jgordosea
jgordosea, Enrolled Agent
Category: Tax
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Experience:  I've prepared all types of taxes since 1987.
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How do I get the figure that I have to put in line 11 Form

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How do I get the figure that I have to put in line 11 Form 6251

Greetings,

 

Just as your regular tax is adjusted for preference items and exclusions to get to your alternative minimum taxable income (AMTI) so is the amount of your net operating loss carry forward separately computed to figure the amount of the alternative tax net operating loss (ATNOL) carrybacks and carryforwards.

 

There are detailed instructions to figure your figure your ATNOLD at http://www.irs.gov/instructions/i6251/ch02.html#d0e344

"Your ATNOL for a loss year is the excess of the deductions allowed for figuring AMTI (excluding the ATNOLD) over the income included in AMTI.

Figure this excess with the modifications in section 172(d), taking into account your AMT adjustments and preferences (that is, the section 172(d) modifications must be separately figured for the ATNOL).

For example, the limitation of nonbusiness deductions to the amount of nonbusiness income must be separately figured for the ATNOL, using only nonbusiness income and deductions that are included in AMTI."

 

To do this manually does require an understanding and application of the modifications that are made, which include all of the items listed in Part I of Form 6251.

 

The AMTNOLD is calculated first by starting with the regular tax NOL and making certain modifications. The regular tax NOL is modified by AMT adjustments and reduced by items of tax preference, but only to the extent the preference items are included in the regular tax NOL.

The AMTNOLD cannot be more than 90 percent of alternative minimum taxable income (AMTI). AMTI is computed without taking into account the AMT NOL and the domestic production activities deduction. In addition, the AMT NOL is considered before any AMT exemption is allowed.

 

Hope this helps for figuring the AMTNOLD from the NOL.

 

Please ask if you need clarification or more discussion.

Thank you.

Customer: replied 3 years ago.

Thank you for responding so fast. From the year 2011 I have an NOL for the amt of $ 325,919 and an AMTNOL of $289,454 . Which amt. should I use to put in line 11

You are welcome.

 

You enter on line 11 the smaller of the AMTNOL or the AMTNOLD which is limit to 90% of your AMTI.

 

From the instructions

"The smaller of:

  1. The sum of the AMTNOL carrybacks and carryforwards to the tax year attributable to net operating losses other than those losses described in 2a below, or

  2. 90% of AMTI for the tax year (figured without regard to the ATNOLD and any domestic production activities deduction, as discussed earlier),"

That is if your AMTI (before the AMTNOL) times .9 is more than your AMTNOL you will use the whole AMTNOL but if your AMTNOL is more than 90% of your AMTI than you are limited for this deduction to the .9 times AMTI.

 

Hope that clarifies for you.

Please so ask if you need more help.

Thank you.

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