If you are within the range of the AMT tax, review periodically your income and expenses to determine whether to postpone or accelerate income, defer the payment of expenses, and/or make certain tax elections.
There are elections, such as the election of alternative straight-line MACRS depreciation, that may avoid AMT adjustments. However, such elections will increase your regular tax. Similarly, adjustment treatment for mining exploration and development costs, circulation expenses, and research expenses can be avoided by elections to amortize (23.2).
If you are on the verge of becoming subject to the AMT, or are already subject to the AMT, and the 26% or 28% AMT rate exceeds your top rate for regular tax purposes you might want to consider the following steps:
If you are generally in a high tax bracket and project that you will be subject to AMT in a current year, you may want to subject additional income in that year to the 26% or 28% AMT tax rate. In such a case, consider accelerating the receipt of income to that year. If you are in business, you might ask for earlier payments from customers or clients. If you control a small corporation, you might prepay your salary or pay yourself a larger bonus, but be careful in the subsequent year not to run afoul of the reasonable compensation rule.
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