The AMT Exemption Amount of $40,000 Phases Out Entirely Once

question 29

True/False

The AMT exemption amount of $40,000 phases out entirely once a corporation's average gross receipts exceeds $310,000.

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Definitions:

Executory Costs

Refers to the expenses incurred in executing a contract, often related to leasing agreements, such as insurance, maintenance, and property taxes.

Operating Expenses

Costs associated with the day-to-day functions of a business, not including the cost of goods sold but typically covering administrative, sales, and general expenses.

GAAP

Generally Accepted Accounting Principles; a framework of accounting standards, rules, and procedures defined by the professional accounting industry in a specific country.

Capitalize

The process of recording an expenditure as an asset, rather than an expense, thereby spreading the cost over its useful life.