Kay Claimed Percentage Depletion of $119,000 for the Current Year

question 56

True/False

Kay claimed percentage depletion of $119,000 for the current year for regular income tax purposes.Cost depletion would have been $60,000.Her basis in the property was $90,000 at the beginning of the current year.Kay must treat the percentage depletion deducted in excess of cost depletion, or $59,000, as a preference in computing AMTI.

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Definitions:

Lesser Tubercles

Lesser Tubercles are small, rounded projections found on the humerus bone near the shoulder, playing a vital role in arm movement by providing attachment points for muscles.

Greater Tubercles

Projections located on the proximal end of the humerus bone, providing attachment for shoulder muscles.

Flexor Carpi Radialis

A muscle in the forearm that assists in bending the wrist towards the thumb side.

Abduct

Abduct refers to the movement of a limb or another part of the body away from the midline or another part of the body.