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Jackson Sells Qualifying Small Business Stock for $125,000 (Adjusted Basis

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Jackson sells qualifying small business stock for $125,000 (adjusted basis of $105,000)in 2011.In calculating gross income for regular income tax purposes,he excludes all of his realized gain of $20,000.The $20,000 exclusion is a tax preference in calculating Jackson's AMTI.


Definitions:

Territorial Governments

Systems of government established in territories, which are regions that are not fully autonomous or sovereign.

Government Business Enterprise

A government-owned entity that operates with the intention to produce goods or services for the market and is expected to be financially self-sufficient.

Statement Of Operations

A financial document, also known as an income statement, showing a company's revenues, expenses, and profits or losses over a specified period.

Net Income

The total profit of a company after all expenses, taxes, and costs have been subtracted from total revenue.

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