AMT from Roth Conversion

Submitted by Ken Kaszak on Thu, 2012-04-12 17:24

My clients are declaring half of their conversion as income for 2011. They are being charged AMT rates. They have no preference items (from what I can see) and their ratio of expenses to income is low.

Question: why would reporting 1/2 of conversion amount trigger AMT?

Ken K.
412-390-1122



Submitted by mk foss on Thu, 2012-04-12 17:37

The Roth income would not trigger AMT. Perhaps the income taxes are higher – no taxes are deductible for AMT or the paid a lot of investment advisor and other fees that are disallowed for AMT. Often higher income will push tax brackets to a level that AMT is not a factor.



Submitted by Ken Kaszak on Thu, 2012-04-12 18:44

Two of my clients hade this happen. In addition, an attorney how specializes in Roth emailed me with a comment that it does happen.

I still don’t understand why. My clients didn’t pay high investment fees and, like everybody else, they had to add back their real estate taxes to their return. That never caused AMT before

Any other ideas?



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