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This exemption is substantially higher than the exemption from regular income tax.Regular taxable income is adjusted for certain items computed differently for AMT, such as depreciation and medical expenses.The alternative minimum tax (AMT) is a supplemental income tax imposed by the United States federal government required in addition to baseline income tax for certain individuals, corporations, estates, and trusts that have exemptions or special circumstances allowing for lower payments of standard income tax.AMT is imposed at a nearly flat rate on an adjusted amount of taxable income above a certain threshold (also known as exemption).

To the extent AMT exceeds regular Federal income tax, a future credit is provided which can offset future regular tax to the extent AMT does not apply in a future year.On January 2, 2013, President Barack Obama signed the American Taxpayer Relief Act of 2012, which indexes to inflation the income thresholds for being subject to the tax.Effectively for high income earners who mitigate their tax position from the day-to-day income tax, an end-of-year consolidation of all taxable income is requested and submitted.A predecessor "minimum tax", enacted in 1969, imposed an additional tax on certain tax benefits for certain taxpayers.The present AMT was enacted in 1982 and limits tax benefits from a variety of deductions.

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