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Under the tax law, certain tax benefits can significantly reduce a taxpayers regular tax amount. The alternative minimum tax (AMT) applies to taxpayers with high economic income by setting a limit on those benefits. It helps to ensure that those taxpayers pay at least a minimum amount of tax.
Form 6251: Alternative Minimum Tax-Individuals is an Internal Revenue Service (IRS) tax form used to determine the amount of alternative minimum tax (AMT) that a taxpayer may owe. Some taxpayers with higher incomes can claim certain deductions that allow them to reduce their regular tax obligations.
To find out if you may be subject to the AMT, refer to the Alternative Minimum Tax (AMT) line instructions in the Instructions for Form 1040 (and Form 1040-SR). If subject to the AMT, you may be required to complete and attach Form 6251, Alternative Minimum Tax Individuals. See the Instructions for Form 6251 PDF.
How does the AMT work? Start with taxable income. Calculate your taxable income as you would normally, or enter the amount from Form 1040, line 15. Make required adjustments. Subtract your AMT exemption. Multiply the result by your AMT tax rate.
Alternative Minimum Tax (AMT) requires individuals and non corporates to calculate their tax liability using the normal method. And if their tax liability turns out to be less than 18.5%, they have to pay the Minimum Alternative Tax at 18.5%.
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People also ask

Calculation of MAT as per Section 115JB It is calculated under section 115JB of the Income Tax Act. MAT is calculated at the rate of 15% (plus surcharge and HEC as applicable) of the taxpayers book profit, and as per section 115JB of the Income Tax Act, book profit is calculated.
The Alternative Minimum Tax (AMT) is a separate tax system that requires some taxpayers to calculate their tax liability twicefirst, under ordinary income tax rules, then under the AMTand pay whichever amount is highest.

2023 irs form 6251