Question: how do you know if you are subject to amt?
Answer: Assuming an average federal tax rate of 22% and tax credits of $2,250 (15% x $15,000), the federal tax payable would be $30,750 (i.e. Calculation A). AMT is calculated based on this formula: A * (B – C) - D Where: A: 15% B: The individual's adjusted taxable income C: 40,000 D: Allowable non-refundable tax credits.