8 8 0 1 OMB No. 1545-1073
fem Credit For Prior Year Minimum Tax 1990
infernal Reverue Seng > Attach to your tax return. Sequence No. 74
Name(s) shown on return Identifying number
Net Minimum Tax on Exclusion Items
1 Enter line 3 of 1989 Form 6251, or line 1 of 1989 Form 4626. Form 1041 filers, see Instructions. 1
2 Enter adjustments and tax preference items treated as exclusion items. See Instructions. 2
3 Minimum tax credit net operating loss deduction. See Instructions . .L3 tC
4 Combine lines 1, 2, and 3. If zero or less, enter -O- here and on line 15 and go to Part I if more ‘than
$155,000 and you are married filing separately, see Instructions 4
5 Enter line 9 of 1989 Form 6251, or line 9a of 1989 Form 4626. Form 8656 | filers, enter $20, 000 5
6 Enter line 10 of 1989 Form 6251, or line 9b of 1989 Form 4626. Form 8656 filers, enter $75,000 . 6
7 Subtract line 6 from line 4. If zero or less, enter -0- here and on line 8 and go to line 9 . 7
8 Multiply line 7 by 25% (.25) and enter the result . 8
9 Subtract line 8 from line 5. If zero or less, enter -O-. If completing for a child under 14, see # Instructions a)
10 Subtract line 9 from line 4. If zero or less, enter -O- here and on line 15, and go to Part Il . a 10
11 Form 6251 and 8656 filers, multiply line 10 by 21% (.21). Form 4626 filers, multiply line 10 by 20% (.. 20) 11
12 Minimum tax foreign tax credit on exclusion items. See Instructions . 12
13 Tentative minimum tax on exclusion items. Subtract line 12 fromline 11. . |13
14 Enter line 18 of 1989 Form 6251, line 15 of 1989 Form 4626, or line 11c, Part mm of 1989 | Form 8656. 14
15 _Net minimum tax on exclusion items. Subtract line 14 from line 13. If zero or less, enter -O- 15
GE Minimum Tax Credit and Carryforward to 1991
16 Enter line 19 of 1989 Form 6251, the sum of lines 14 and 16 of 1989 Form 4626, or line 12, Part III,
of 1989 Form 8656 . 16
17 Enter the amount from line 15 above . 17
18 Subtract line 17 from line 16. If line 17 is greater than line 16, enter the result a asa : negative amount . 18
19 Carryforward of minimum tax credit from 1989. Enter amount on line 28 of 1989 Form 8801 . 19
20 Enter your 1989 unallowed credit for fuel produced from a nonconventional source. Also include any
unallowed orphan drug credit. See Instructions . Soe . 20
21 Combine lines 18, 19, and 20. If zero or less, do not complete th the rest of this form. See Instructions . 21
22. Enter your 1990 regular income tax liability minus allowable tax credits. See Instructions 22
23. Enter line 17 of 1990 Form 6251, line 13 of 1990 Form 4626, or line 37 of 1990 Form 8656 . 23
24 Subtract line 23 from line 22. If zero orless,enter-O- . . . £24
25 Minimum tax credit. Enter the smaller of line 21 or line 24. Also enter this amount on nthe appropiate
line of your 1990 tax return. See Instructions . . (25
26 Minimum tax credit carryforward to 1991. Subtract line 25 from line 21. See | Instructions 26

General Instructions

(Section references are to the Internal
Revenue code.)

Paperwork Reduction Act Notice.—We
ask for the information on this form to carry
out the Internal Revenue laws of the United
States. You are required to give us the
information. We need it to ensure that you
are complying with these laws and to allow
us to figure and collect the right amount of
tax.

The time needed to complete and file this
form will vary depending on individual
circumstances. The estimated average time
is:

Recordkeeping . . Lhr., 33 min.
Learning about the

law or the form . Thr., 3 min.
Preparing the form . Lhe.
Copying, assembling, and

sending the form to IRS . - 17 min.

If you have comments concerning the
accuracy of these time estimates or
suggestions for making this form more
simple, we would be happy to hear from
you. You can write to both the IRS and the

Office of Management and Budget at the
addresses listed in the instructions of the
tax return with which this form is filed.

Purpose of Form

Form 8801 is used to compute the
minimum tax credit, if any, for alternative
minimum tax (AMT) incurred in prior tax
years after 1986. The form is also used to
figure any minimum tax credit carryforward
that may be used in future years.

Who Should File

Form 8801 should be completed by
individuals, corporations, trusts, and
estates that had:

@ an AMT liability in 1989 (or an amount on
line 14 of Form 4626) and adjustments or
tax preference items (other than exclusion
items) in 1989;

@ a minimum tax credit carryforward from
1989 to 1990; or

@ a 1989 unallowed nonconventional
source fuel credit or an unallowed orphan
drug credit for any tax year after 1986 (see
the instructions for iine 20 of this form).

Recordkeeping.—Use Form 8801 each
year to see if you have a minimum tax credit
and to keep track of any credit carryforward.
(See line 28 of your 1989 Form 8801.)

Specific Instructions

The AMT is attributable to two types of
adjustments and tax preference
items—“exclusion items” and “deferral
items.” The minimum tax credit is allowed
only on the AMT attributable to deferral
items.

Deferral items are generally adjustments
and tax preference items that do not cause
a permanent difference in taxable income
over a number of years. An example is
depreciation. Exclusion items, on the other
hand, cause a permanent difference in
taxable income. An example is the personal
exemption.

Line 1—Form 1041 filers.—Skip lines 1
through 3 of Form 8801. Complete Parts |
and II of another 1989 Form 8656. For Part
| of Form 8656, take into account only
exclusion items (the amount included on
lines 4e and 6d of Part | of Form 8656). On
line 9, Part | of Form 8656, use the
minimum tax credit net operating loss


Form 8801 (1990)

Page 2

deduction (MTCNOLD). However, do not
limit the MTCNOLD to 90 percent of the
amount on line 8, Part | of Form 8656 (see
the instructions for line 3 below for how to
compute the MTCNOLD). On Part Il of Form
8656, do not take into account any basis
adjustments arising from deferral items in
completing lines 6 and 7. if the amount on
line 12, Part | of Form 8656 is zero or less,
enter -0- on line 4 of Form 8801.
Otherwise, enter the amount from line 12,
Part | of Form 8656 on line 4 of Form 8801.
Line 2.—Enter on this line the adjustments
and tax preference items treated as
exclusions.

Exclusion items are your AMT
adjustments and tax preference items for:
the standard deduction, personal
exemptions, estate or trust exemption,
itemized deductions (including any
investment interest expense reported on
Schedule E), the deduction for charitable
contributions of appreciated property,
certain tax-exempt interest, depletion, and,
for certain insurance organizations, the
adjustment under section 833(b).

Follow the instructions below to figure
the amount to enter on line 2.

Individuals. Combine lines 4i and 5d of
your 1989 Form 6251.

Corporations. Combine lines 2i and 3d of
the corporation’s 1989 Form 4626.
Estates and trusts. Combine lines 4e and
6d of the 1989 Form 8656 and line 20 of
the 1989 Form 1041.

Note: /f you included any of the exclusion
items on a line other than those listed
above, include that item in the amount to
be entered on line 2. For example, if
depletion was included on Form 6251 as an
adjustment on line 4s (passive activity loss)
instead of on line 5c (depletion), include it
as an exclusion item when figuring the
amount for line 2.

Exclusion items included in adjusted net
book income will not be taken into account
for purposes of the minimum tax credit.
Line 3—Minimum tax credit net
operating loss deduction (MTCNOLD).—
Your MTCNOLD is the aggregate of the
minimum tax credit net operating loss
(MTCNOL) carryovers and MTCNOL
carrybacks to the tax year. The MTCNOLD.
is not limited to 90 percent of alternative
minimum taxable income (AMTI) computed
by taking into account only exciusion items.
Your MTCNOL is figured as follows:

For loss years beginning after 1986, your
MTCNOL is the excess of the deductions
allowed in computing AMT] (excluding the
MTCNOLD), taking into account only
exclusion items, over the income included
in computing AMTI, taking into account only
exclusion items. This excess is computed
with the modifications contained in section
172(d), taking into account exclusion items
(i.e., the section 172(d) modifications
should be separately computed in figuring
the MTCNOL).

For example, the limitation of
nonbusiness deductions to the amount of
nonbusiness income must be separately

computed in figuring the MTCNOL using
only nonbusiness income and nonbusiness
deductions taking into account only
exclusion items. However, ignore the
disallowance of the deduction for personal
exemptions under section 172(d)(3)
because it has already been taken into
account in computing AMTI using only
exclusion items.

For loss years beginning before 1987, the
amount of MTCNOL that may be carried
forward to tax years beginning after 1986 is
equal to the amount of regular tax NOL that
may be carried from such loss years to the
first tax year beginning after 1986.

To determine the amount of MTCNOL
that may be carried to tax years other than
1989, apply sections 172(b)(2) and 172(d),
with appropriate modifications to take into
account exclusion items.

Line 4.—If you are married filing a
separate return and line 4 is greater than
$155,000, you must include an additional
amount on line 4. If line 4 is $235,000 or
more, include an additional $20,000 on line
4. Otherwise, include 25% of the excess of
the amount on iine 4 over $155,000. For
example, if the amount on line 4 is
$175,000, enter $180,000 instead—the
additional $5,000 is $20,000 ($175,000
minus $155,000) times 25% (.25).

Line 9.—If you are completing this form for
a child who was under age 14 on January 1,
1990, and at least one of the child’s
parents was alive on December 31, 1989,
do not follow the instructions on the form
for line 9. Instead, if line 8 is equal to or
more than !ine 5, enter -O-; otherwise,
enter the smaller of: (1) the amount by
which line 5 exceeds line 8, or (2) the
amount entered on line F of the worksheet
for line 13 of the child's 1989 Form 6251.

Line 12—-Minimum tax foreign tax
credit.—Refigure your 1989 minimum tax
foreign tax credit using only exclusion items
that were attributable to sources outside
the U.S. To do this, use a 1989 Form 1116
or Form 1118, whichever applies, and
follow the steps below.

Step 1. Use a separate Form 1116 (or Form
1118) for each type of income.

Step 2. Fill in Part | of Form 1116 (or
Schedule A of Form 1118) using that
portion of your taxable income and
exclusion items that were attributable to
sources outside the United States.

Step 3. Fill in Part Ill of Form 1116 (or
Schedule B, Part Il of Form 1118).
However, instead of entering the AMT
foreign tax credit carryforward on line 2,
Part Ill of Form 1116 (or line 4, Part Il,
Schedule B of Form 1118), use the foreign
tax credit carryforward, if any, figured on
exclusion items last year. Enter the amount
from line 4 of this form on line 9, Part II! of
Form 1116 (or line 7c, Part Il, Schedule B
of Form 1118). Enter the amount from line
11 of this form reduced by the child care
credit and the credit for the elderly or
disabled, if any, on line 11, Part Ill of Form
Hi8 (or line 9, Part II, Schedule B of Form
1118).

Step 4. Complete Part IV of Form 1116 (or
Schedule B, Part Ill of Form 1118). Enter
the refigured credit from Form 1116 (or
Form 1118) on line 12 of this form.

If line 5, Part Ill, of Form 1116 (or line 5,
Part Il, Schedule B of Form 1118) was
greater than line 12, Part Ill, of Form 1116
(or line 10, Part li, Schedule B of Form
1118), keep a record of the difference
between lines 5 and 12 of Form 1116 (or
lines 5 and 10 of Form 1118). This amount
is carried forward and used to compute your
foreign tax credit on exclusion items next
year.

Line 20.—Enter the unused portion of your
1989 credit for fuel produced from a
nonconventional source that was not
allowed solely because of the limitation
under section 29(b)(5)(B).

Also include on this line any orphan drug
credit not allowed solely because of the
limitation under section 28(d)(2)(B) in any
prior tax year after 1986.

Line 21.—If line 21 is zero or less, you do
not have a minimum tax credit ora
minimum tax credit carryforward. Do not
complete the rest of this form.

Line 22.—Follow the instructions below
and refer to your 1990 income tax return to
figure the amount to enter on line 22.

Form 1040..—Subtract from the amount
on line 40 the total of any credits on lines
41 through 44 and any write-in credits on
line 46 for the mortgage interest credit or
the credit for fuel produced from a
nonconventional source.

Form 1040NR.—Subtract from the
amount on line 38 the total of any credits
on lines 39 through 41 and any write-in
credits on line 43 for the mortgage interest
credit or the credit for fuel produced from a
nonconventiona! source.

Form 1041.—Subtract the total of any
credits on lines 2a through 2c, Schedule G
from the amount on line 1, Schedule G.
Form 1120.—Subtract any credits on lines
4a through 4e, Schedule J from the amount
on line 3, Schedule J.

Form 1120-A.—Subtract the amount on
line 2a, Part | from the amount on line 1,
Partl.

Line 25.—Enter the minimum tax credit on
the following line of your tax return:

Form 1040, line 45.

Form 1040NR, line 42.

Form 1041, line 2d, Schedule G.

Form 1120, line 4f, Schedule J.

Form 1120-A, line 2b, Part |.

All Others.—Enter the minimum tax credit
on the line provided on your tax return.
Note: Section 383 may limit the amount of
tax of a corporation for any tax year ending
after a post-1986 ownership change that
may be offset by pre-change minimum tax
credits. If this limitation applies, attach your
computation of the allowable minimum tax
credit, enter that amount on line 25, and
write “Sec. 383” on the dotted line to the
left of line 25.

Line 26—Carryforward of minimum tax
credit.—Keep a record of this amount
because it can be carried forward and used
in future years.

“U.S. Government Printing Office: 1900 — 266-407