AMT And Depreciation
This is my first year with investing...thanks for any help.
I am trying to educate my self about taxes and the AMT. On the net, I ran across this statement:
"Turn your tax planning on its head. The usual way to try to keep a lid on your tax bill is to accelerate deductions and postpone as much income as possible. But if you’re at risk of falling into the AMT or you’re already in it, consider doing the exact opposite, Rubin says. The more ordinary income you have relative to your deductions, the less likely you will be in the AMT -- or, the less it will sting."
This brings up several questions:
1. Is AMT depreciation different from regular depreciation? How?
2. What determines if you fall into the category of paying AMT? Is it something as simple as AGI? If so, how is AGI calculated for this? The regular way using regular depreciation, or the AMT way using AMT depreciation?
3. Last year I paid AMT. This year I will have approximately 80k in depreciation (regular calculation). Will this keep me out of paying AMT or at least help?
4. I was going to accelerate my depreciation by compartmentalizing out the 5-year and 15-year components of my properties, and depreciate those parts on their faster timeframe. This seems to contradict directly to the above statement which argues against such acceleration...can anyone advise?
Help!? Any other AMT comments?
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