Form 6251 – 2013 Tax Year Checklist
Purpose
Form 6251 calculates the Alternative Minimum Tax for individuals by recalculating taxable income using AMT rules and comparing the resulting tax to the regular tax. The American Taxpayer Relief Act of 2012 permanently indexed the AMT exemption amount to inflation beginning in 2013, eliminating annual Congressional patch requirements that had applied since 2001.
Completion Steps
Verify your 2013 filing status and locate the corresponding AMT exemption amount from the 2013 instructions, as exemption thresholds were permanently adjusted upward through ATRA indexing effective January 1, 2013.
Complete Form 6251 line 1 following these instructions:
- Enter the amount from Form 1040, line 41, and proceed to line 2 if you are filing Schedule A.
- Enter the amount from Form 1040, line 38, and proceed to line 7 if you are not filing Schedule A.
- You must enter negative amounts when applicable.
Add back all taxes from Schedule A line 9 on Form 6251 line 3, which includes state and local income taxes from line 5, real property taxes from line 6, personal property taxes from line 7, and other taxes from line 8. This adjustment applies to all AMT filers regardless of whether the total taxes exceeded any dollar threshold.
Report passive activity adjustments on Form 6251 line 19 by calculating the difference between AMT passive activity income or loss and regular tax passive activity treatment. The difference calculation methodology remained strict for the 2013 tax year with no major rule changes.
Include depreciation adjustments on Form 6251 line 18 using the alternative depreciation system method for property placed in service after 1986. Real property placed in service before 1987 continues to use the same depreciation method under both regular and alternative minimum tax.
Complete Part III only if required by line 31 instructions or if you reported net capital gains or qualified dividends. The 2013 capital gains rates included 0 percent, 15 percent, 20 percent, and 25 percent, with the 20 percent rate applying to taxpayers in the highest income bracket and the 25 percent rate applying to unrecaptured Section 1250 gain.
Multiply the excess income from line 30 by 26 percent for amounts of $179,500 or less, or by 28 percent for amounts exceeding this threshold, and then subtract $3,590, or $1,795 if married filing separately, for amounts exceeding $179,500. Apply preferential rates to the capital gains shown in Part III using the correct 2013 capital gains threshold amounts, as specified in the instructions.
Subtract the AMT foreign tax credit from the tentative minimum tax to arrive at the final AMT amount on line 35. The foreign tax credit limitation under AMT operates separately from the regular tax limitation and typically results in a lower allowed credit.
2013-Specific Updates and Rules
ATRA permanently indexed AMT exemption amounts to inflation beginning in 2013. The 2013 exemption amounts are:
- $51,900 for single or head of household filers.
- $80,800 for married filing jointly or qualifying widow status.
- $40,400 for married filing separately.
These amounts replace the prior-year patch-and-reset cycle and serve as the baseline for all future years.
The capital gains rate structure changed for the 2013 tax year under ATRA. The top rate for capital gains and dividends increased to 20 percent for taxpayers with taxable income exceeding $400,000 for single filers or $450,000 for married filing jointly.
The 15 percent rate continues to apply to most qualified dividends and long-term capital gains for taxpayers below these thresholds. The 0 percent rate applies only within specified lower-income brackets.
Form References and Line Numbers
- Form 1040 line 37 contains adjusted gross income for 2013.
- Form 1040 line 38 serves as the starting point for the tax calculation section.
- Form 1040 line 41 shows taxable income after deductions.
- Form 6251 line 1 references either Form 1040 line 41 or line 38, depending on whether you itemize deductions.
- Schedule A line 9 represents the total of all taxes you paid, including state and local income taxes, real estate taxes, personal property taxes, and other taxes.
Exemption Phase-Out Thresholds
The exemption amount phases out when line 28 of Form 6251 exceeds certain thresholds:
- $115,400 for single or head of household filers.
- $153,900 for married filing jointly or qualifying widow filers.
- $76,950 for married filing separately.
AMT Tax Rates and Brackets
The 26 percent tax rate applies to the first $179,500 of taxable excess for most filers or $89,750 for married filing separately. The 28 percent tax rate applies to taxable excess amounts exceeding these thresholds. When the 28 percent rate applies, you subtract $3,590 from the result for most filers or $1,795 for married filing separately.
Capital Gains Rate Application
The 0 percent capital gains rate applies to taxpayers in the 10 percent and 15 percent ordinary income tax brackets. The 15 percent capital gains rate applies to taxpayers in the 25 percent, 28 percent, 33 percent, and 35 percent ordinary income tax brackets.
The 20 percent capital gains rate applies to taxpayers in the 39.6 percent ordinary income tax bracket. The 25 percent rate applies specifically to unrecaptured Section 1250 gain from depreciation recapture on real property.
Important Changes From Prior Years
No temporary AMT relief patch was enacted for 2013 under the emergency measures of prior years. Filers who previously benefited from temporary exemption increases must apply the permanently indexed 2013 amounts only. The shift from temporary patches to permanent indexing represents a fundamental change in AMT administration and planning.
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This checklist is for educational purposes only and does not constitute tax or legal advice. Always review official IRS instructions and consult a qualified professional for guidance.
