Free 2008 I-129 Instructions for 2008 Wisconsin Schedule MT - Wisconsin

INSTRUCTIONS FOR 2008 WISCONSIN SCHEDULE MT
GENERAL INSTRUCTIONS
Who Must File Generally, you may have to pay alternative minimum tax if your Wisconsin income combined with any adjustment or tax preference items totals more than: · · · · $45,000 if married filing a joint return, $33,750 if single or head of household, $22,500 if married filing a separate return, or $22,500 if a trust or estate. AMTI made after that date cannot be used for Wisconsin for 2008. The Emergency Economic Stabilization Act of 2008 changed federal law to allow the portion of the standard deduction attributable to a net disaster loss to be used in the computation of federal AMTI. If this deduction is claimed on line 7 of your 2008 federal Form 6251, recompute federal AMTI without such deduction. · If you are married filing a separate federal income tax return and are required to include an additional amount of federal AMTI on line 29 of federal Form 6251 because your federal AMTI exceeds $214,900, fill in on line 1 of Schedule MT the federal AMTI before such additional amount was included. Line 2 Additions Because your federal AMTI (line 1 of Schedule MT) may include items which are not deductible for Wisconsin, or such federal income does not include items which are taxable for Wisconsin, you may have to add these items to arrive at the correct Wisconsin AMTI. Resident Individuals ­ Fill in lines 2a, 2b, and 2c. Do not fill in an amount on line 2d or 2e. Also, fill in lines 2f and 2g. Exception If you are a beneficiary of an estate or trust, fill in on line 2d the amount of state and local taxes which is included in Column (c) of your Schedule 2K-1. Part-Year Resident and Nonresident Individuals ­ Fill in -0- on line 2g and see the instructions for line 4. Estates and Trusts ­ Fill in lines 2a through 2g. For line 2b, fill in only the portion of the tax preference for tax-exempt interest from line 8 of Schedule I of your federal Form 1041 which is allocable to nondistributable income. Line 3 Subtractions Because your federal AMTI (line 1 of Schedule MT) may include items which are not taxable for Wisconsin, or such federal income does not include items which are deductible for Wisconsin, you may have to subtract these items to arrive at the correct Wisconsin AMTI (for example, the 60% Wisconsin capital gain exclusion is subtracted from federal AMTI to arrive at Wisconsin AMTI). Resident Individuals ­ Fill in lines 3a, 3b, and 3c. Do not fill in an amount on line 3d. Also, fill in lines 3e and 3f. Part-Year Resident and Nonresident Individuals ­ Fill in -0- on line 3f and see the instructions for line 4. Estates and Trusts ­ Fill in lines 3a through 3f. Line 4 Resident Individuals and Estates and Trusts ­ If line f is smaller than line 2g, subtract line 3f from line 2g and fill in the result on line 4. If line 3f is larger than line 2g, subtract line 2g from line 3f and fill in the result as a negative number.

(Note: These guidelines do not apply to part-year resident and nonresident individuals, estates, and trusts because of required proration.) See the instructions for federal Form 6251 (Schedule I of Form 1041 for estates and trusts) for descriptions of adjustment and tax preference items. Individuals, estates, and trusts must file Schedule MT if the income tax computed on line 28 of Wisconsin Form 1, line 54 of Wisconsin Form 1NPR, or line 10 of Wisconsin Form 2 is less than the Wisconsin tentative minimum tax.

SPECIFIC INSTRUCTIONS
CAUTION: The Internal Revenue Service hadn't finalized the 2008 federal Forms 1041 and 6251 at the time that Schedule MT and these instructions went to print. Therefore, line numbers on federal Forms 1041 and 6251 referred to on Schedule MT and in these instructions may change. Line 1 Federal Alternative Minimum Taxable Income (AMTI) Individuals ­ Fill in your federal AMTI from line 29 of federal Form 6251. Estates and Trusts ­ Fill in your federal AMTI from line 29 of Schedule I of federal Form 1041. Exceptions · If you are required to file a Wisconsin Schedule I (complete Schedule B of Form 2 for estates and trusts) because differences between federal and Wisconsin law affect you, you must recompute Form 6251 (Schedule I of Form 1041 for estates and trusts), substituting the federal income amounts determined on Wisconsin Schedule I (using Schedule B of Form 2 for estates and trusts) for the income shown on federal Form 1040 (Form 1041 for estates and trusts). Label this recomputed Form 6251 (Schedule I of Form 1041 for estates and trusts) "Wisconsin" and enclose it with your Wisconsin income tax return. · Wisconsin uses the Internal Revenue Code in effect on December 31, 2006. Changes to the computation of federal
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Part-Year Resident and Nonresident Individuals ­ Complete the following worksheet to determine the amount to fill in on line 4: 1. Wisconsin income from line 32 of Form 1NPR 1. ________

Line 8 Adjustments · If adjustments and preferences reported on lines 10, 12, and 14 through 27 of federal Form 6251 (lines 6, 8, and 10 through 23 of Schedule I of federal Form 1041 for estates and trusts) did not result in a tax benefit for Wisconsin tax purposes, fill in the net amount of those adjustments and preference items on line 8 of Schedule MT. Amounts filled in on these lines on federal Form 6251 will not produce a tax benefit if you are a part-year resident or nonresident of Wisconsin and the related income or deduction does not have a Wisconsin situs. (Note: Also include any portion of the adjustment from line 8 of federal Form 6251 that relates to investment interest expense reported on Schedule E which did not result in a tax benefit.) Example: You are a nonresident of Wisconsin, but are required to file a Wisconsin income tax return because of rental property you own in Wisconsin. On line 18 of federal Form 6251 you report an accelerated depreciation tax preference of $5,000 which relates to rental property you own in Illinois. Because the income from your rental property in Illinois is not taxable to Wisconsin, the $5,000 accelerated depreciation tax preference should be filled in on line 8 of Schedule MT as a negative number. Example: You are a nonresident of Wisconsin, but are required to file a Wisconsin tax return because of rental property you own in Wisconsin. On line 19 of federal Form 6251 you report a passive activity loss adjustment of $5,000 which relates to an Iowa partnership in which you are a limited partner. The income from your limited partnership interest is not allocable to Wisconsin. The $5,000 passive activity loss adjustment should be filled in on line 8 of Schedule MT as a negative number. CAUTION: Estates and trusts should only enter amounts allocable to nondistributable income. · If an amount was reported on line 14 of federal Form 6251 (line 10 of Schedule I of federal Form 1041 for estates and trusts) with regard to incentive stock options, that adjustment relating to stock options (including any basis adjustment) should be reduced by 20% for Wisconsin purposes. Fill in the 20% reduction on line 8 of Schedule MT, provided the adjustment for incentive stock options is not removed in total from federal AMTI for some other reason. CAUTION: Do not add back 20% of the federal basis adjustment made when incentive stock option stock is sold if you did not receive a Wisconsin tax benefit from reducing the federal adjustment in the year of exercise by 20%.

2. Wisconsin net operating loss included on line 15, Column B of Form 1NPR (enter as a positive number) 2. ________ 3. State income tax refund from line 4, Column A of Form 1NPR 4. Recoveries of federal itemized deductions included on line 15, Column A of Form 1NPR 5. Add lines 1 through 4 3. ________

4. ________ 5. ________

6. Federal income from line 33 of Form 1NPR* . . . . . . . . . . . . . . . . 6. _________ 7. Federal net operating loss carryover from line 21 of federal Form 1040 (enter as a positive number) . . . . . 7. _________ 8. Add lines 6 and 7 8. ________ 9. If line 8 is smaller than line 5, subtract line 8 from line 5 and fill in the result. If line 8 is larger than line 5, subtract line 5 from line 8 and fill in the result as a negative number 9. ________ Fill in the amount from line 9 of the worksheet on line 4 of Schedule MT. * If military compensation of a nonresident was excluded from line 1, Column A of Form 1NPR, include the amount excluded on line 6. Line 6 Itemized Deduction Addback Resident Individuals and Estates and Trusts ­ Fill in -0on line 6. Part-Year Resident and Nonresident Individuals ­ You may have to add back to federal AMTI a portion of your itemized deductions. Figure the amount to add back as follows: 1. Itemized deductions from line 40 of federal Form 1040 and line 6 of federal Form 6251 (treat as a positive number) less amounts from lines 2 through 5 and 9 of federal Form 6251 1. _________ 2. Fill in one (1.00) minus the proration ratio from line 34 of Form 1NPR 3. Multiply line 1 by line 2. Fill in the result here and on line 6 of Schedule MT 2. _________

3. _________
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· If any addition or subtraction amount on line 2a or 3a of Schedule MT (or used in computing Wisconsin income for nonresidents or part-year residents) relates to items that generate adjustment or preference amounts for minimum tax purposes on lines 10, 12, and 14 through 27 of federal Form 6251 (lines 6, 8, and 10 through 23 of Schedule I of federal Form 1041 for estates and trusts), any resulting increase or decrease in the amount of the adjustment or preference item for Wisconsin purposes should be filled in on line 8 of Schedule MT. Example: On line 17 of federal Form 6251, you reported an adjustment for the recomputation of gain or loss of property sold as a result of using the accelerated cost recovery system (ACRS) method of depreciation for federal tax purposes. This property had been depreciated using the straight line method for Wisconsin tax purposes. Therefore, any difference in the amount of adjusted gain or loss because of differences in depreciation methods for federal and Wisconsin tax purposes should be reported on line 8 of Schedule MT. Example: On line 2a of Schedule MT, you claimed an addition (from Schedule T) for depreciation on property which had a different basis for federal and Wisconsin purposes. The property is depreciated using the ACRS method of depreciation. As a result, you reported as a tax preference the difference between ACRS depreciation and straight line depreciation on federal Form 6251. The amount of this tax preference should be reduced to reflect the difference in depreciation allowable for Wisconsin and federal purposes. · If adjustments or preferences distributed to you from a tax-option (S) corporation, partnership, estate, or trust differ for Wisconsin, fill in the amount of the difference on line 8 of Schedule MT. Example: On your Wisconsin Schedule 5K-1 (TaxOption (S) Corporation Shareholders' Share of Income, Deductions, etc.), the federal amount of adjustments distributed is $8,000. An adjustment is shown in Column (c) of ($3,000) and a Wisconsin amount of $5,000 is shown in Column (d). Since $8,000 is already included on line 1 of Schedule MT, fill in $3,000 on line 8 as a negative number. Example: On your Wisconsin Schedule 3K-1 (Wisconsin Partner's Share of Income, Deductions, etc.), the federal amount of tax preferences distributed is $5,000. A modification is shown in Column (c) of ($2,000) and a Wisconsin amount of $3,000 is shown in Column (d). Since $5,000 is already included on line 1 of Schedule MT, fill in $2,000 on line 8 of Schedule MT as a negative number.

Line 12 Wisconsin Alternative Tax Net Operating Loss (ATNOL) If you sustained a Wisconsin regular tax net operating loss in prior years, you must compute your Wisconsin ATNOL and carryover. A Wisconsin ATNOL and carryover to 2008 is computed as follows: 1. Figure the ATNOL for the loss year ­ Your ATNOL is your regular tax net operating loss reduced or increased, as appropriate, by those tax preference items and adjustments from federal Form 6251 for the loss year that applied for Wisconsin. If in any year the tax preferences and adjustments are greater than your regular tax net operating loss, you do not have an ATNOL for that year. 2. Figure the ATNOL carryover to 2008 ­ An ATNOL may be carried forward and used to decrease AMTI for up to 15 years. If the current year is the first year to which the ATNOL is carried, the amount of the carryover is the amount of the ATNOL. Otherwise, the amount of the carryover is the amount of the ATNOL remaining after subtracting the amount used in all preceding carryover years to decrease AMTI. You must consider the ATNOL used in each carryover year even if you did not owe Wisconsin alternative minimum tax each year. Example: Your regular tax net operating loss and tax preferences are indicated below. For 2007, you used $5,000 of your ATNOL to decrease AMTI. You would compute your Wisconsin ATNOL carryover to 2008 as follows: 2005 2006 2007 Regular tax net operating loss $5,000 $15,000 $29,000 Less tax preferences 2,000 4,000 33,000 ATNOL Less ATNOL used to decrease 2007 AMTI ATNOL carryover available for 2008 $3,000 $11,000 $ 3,000 2,000 -0-0-0-

$ - 0 - $ 9,000 $

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Line 13 If you are married filing a separate Wisconsin income tax return and the result of subtracting line 12 from line 11 is more than $165,000, complete the following worksheet: 1. Subtract line 12 of Schedule MT from line 11 of Schedule MT 2. Exemption amount 3. Subtract line 2 from line 1 4. Multiply line 3 by .25 (25%) 6. Add lines 1 and 5. Fill in the result here and on line 13 of Schedule MT 1. _________ $ 165,000 2. _________ 3. _________ 4. _________

If line 13 of Schedule MT is over these amounts, complete the following worksheet to compute the amount to fill in on line 15: 1. Fill in the amount from line 13 of Schedule MT . . . . . . . . . . . . . . . . . . . 1. ___________ 2. Fill in $150,000 ($112,500 if single or head of household, or $75,000 if married filing separately or an estate or trust) . 2. ___________ 3. Subtract line 2 from line 1 . . . . . . . . . 3. ___________ 4. Multiply line 3 by .25 (25%). If this form is for a part-year resident or nonresident individual, a nonresident estate or trust, or a part-year resident trust, complete line 5 or 6 below. Otherwise stop here and fill in this amount on line 15 of Schedule MT . . 4. ___________ 5. Part-year resident and nonresident individuals ­ multiply the amount on line 4 by the proration ratio from line 34 of Form 1NPR. Fill in this amount on line 15 of Schedule MT . . 5. ___________ 6. Nonresident estates and trusts and part-year resident trusts ­ multiply the amount on line 4 by the proration ratio on line 3 of the worksheet for line 14b. Fill in this amount on line 15 of Schedule MT . . . . . . . . . . . . . . . . . . . 6. ___________ Line 16 Subtract line 15 from line 14a or 14b, as appropriate, and fill in the result on line 16. If the result is zero or less, fill in -0-. Line 17 Subtract line 16 from line 13 and fill in the result on line 17. If the amount filled in on line 17 is zero or less, do not complete the rest of this schedule. You do not owe a Wisconsin alternative minimum tax. Line 18 Multiply the amount on line 17 by .065 (6.5%) and fill in the result on line 18. Line 19 Fill in the amount of your Wisconsin tax from line 28 of Wisconsin Form 1, line 54 of Wisconsin Form 1NPR, or line 10 of Wisconsin Form 2. Line 20 If line 19 is larger than line 18, fill in -0- on line 20. You do not owe a Wisconsin alternative minimum tax. If line 18 is larger than line 19, subtract line 19 from line 18 and fill in the result on line 20. This is your Wisconsin alternative minimum tax due. Fill in this amount on line 29 of Form 1, line 55 of Form 1NPR, or line 11 of Form 2.

5. Enter the smaller of line 4 or $22,500 5. _________ 6. _________

If the amount filled in on line 13 is zero or less, do not fill in the rest of this schedule. You do not owe a Wisconsin alternative minimum tax. Lines 14a and 14b Resident Individuals, Estates, and Trusts ­ Fill in the exemption amount shown on line 14a. Part-Year Resident and Nonresident Individuals ­ Multiply $45,000 ($33,750 if single or head of household, or $22,500 if married filing separate return) by the proration ratio from line 34 of Form 1NPR. Fill in the result on line 14b. Nonresident Estates and Trusts and Part-Year Resident Trusts ­ Use the following worksheet to compute the amount to fill in on line 14b: 1. Total income from line 9 of federal Form 1041 . . . . . . . . . . . . . . . . . . . . . 1. __________ 2. Wisconsin income included on line 1 of this worksheet (i.e., total income with a Wisconsin situs) . . . . . 2. __________ 3. Divide line 2 by line 1 (do not fill in more than one (1)). This is your proration ratio . . . . . . . . . . . . . . . . . . 3. __________ 4. Multiply $22,500 by the proration ratio on line 3. Fill in the result on line 14b of Schedule MT . . . . . . . . . . 4. __________ Line 15 Exemption Phase-Out Amount complete line 15 if: You are: You must

And line 13 is over:

Married filing jointly . . . . . . . . . . . . $150,000 Single or head of household . . . . . . . $112,500 Married filing separately . . . . . . . . . . . $75,000 An estate or trust . . . . . . . . . . . . . . . . . $75,000

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