How is the federal alternative minimum tax recomputed to determine the Nebraska minimum tax on a 2012 individual income tax return?

Plain-English summary

This is the 2012 individual entry in Nebraska's annual AMT-recomputation series (the 2013 version is Revenue Ruling 22-13-2). It's a mechanical worksheet ruling: it tells you how to translate your federal alternative minimum tax (AMT) into the Nebraska minimum tax on your 2012 Form 1040N.

Why recompute? Nebraska starts from federal figures but treats some items differently, so you must redo the federal AMT using Nebraska's adjustments (Neb. Rev. Stat. § 77-2715) rather than copying the federal number. The § 77-2716 adjustments include:

• Excluding interest or dividends from U.S. obligations.
• Including interest or dividends from non-Nebraska state or local obligations.
• Excluding non-Nebraska income from an S corporation or LLC -- and any related AMT preference item to the same extent.

How it works: starting from the 2012 Federal Form 6251 (AMT - Individuals) or the Form 1040A AMT Worksheet, you redo specific lines using amounts from Nebraska Form 1040N (the exact line-by-line changes are in the original text below). Recompute the total/computational lines; leave all other entries the same as the federal computation, and attach a copy of the recomputed federal form to your Form 1040N. The ruling also lists the equivalent recomputation rulings for the preceding three years.

Forward context: Nebraska's Alternative Minimum Tax was later eliminated by LB 308 (2013), beginning with tax year 2014 -- so this 2012 recomputation is historical, relevant to the 2012 return and open prior years.

What this means for you

2012 individual filers (and amended-return preparers for open years)

If you had a federal AMT for 2012, you had to recompute it for Nebraska using § 77-2715/§ 77-2716 adjustments and attach the recomputed federal form to your Form 1040N. Follow the specific line entries in the original text.

Current filers

Not applicable going forward -- Nebraska's AMT ended after tax year 2013 (LB 308, 2013).

Common questions

Q: Can I use my federal AMT number directly on the Nebraska return?
A: No. It must be recomputed using Nebraska's adjustments (Neb. Rev. Stat. § 77-2715) before being carried to Form 1040N.

Q: What are the main Nebraska adjustments?
A: Exclude interest/dividends from U.S. obligations and non-Nebraska S corp/LLC income (and related preference items); include interest from non-Nebraska state or local obligations (Neb. Rev. Stat. § 77-2716).

Q: Does this still apply?
A: It applies to tax year 2012 and open prior years. Nebraska's AMT was eliminated for tax year 2014 by LB 308 (2013).

Citations and references

• Neb. Rev. Stat. § 77-2715 -- the adjustments used to recompute the federal AMT for Nebraska minimum tax purposes.
• Neb. Rev. Stat. § 77-2716 -- Nebraska adjustments (exclude U.S.-obligation interest/dividends and non-Nebraska S corp/LLC income; include non-Nebraska state/local obligation interest).
• Later development: Nebraska's Alternative Minimum Tax was eliminated by LB 308 (2013) beginning with tax year 2014.

Source

• Landing page: https://revenue.nebraska.gov/about/legal-information/revenue-rulings-issued-tax-commissioner
• Original PDF: https://revenue.nebraska.gov/sites/revenue.nebraska.gov/files/doc/legal/rulings/rr221201_ind_alt_min.pdf

Original ruling text

Revenue Ruling 22-12-1
Individual Income Tax
February 13, 2013

Computation of 2012 Alternative Minimum Tax to Determine
Nebraska Minimum Tax for the 2012 Nebraska Return
Issue
How should the alternative minimum tax (AMT) computed for a taxpayer’s 2012 U.S. Individual
Income Tax Return, Federal Form 1040 or 1040A, be recalculated to compute the Nebraska AMT?

Conclusion
The federal AMT must be recomputed using the adjustments required by Neb. Rev. Stat. § 77-2715.
This will facilitate the computation for items which are reflected differently in the determination of
federal taxable income for Nebraska purposes. This applies to any federal schedules or other forms, the
results of which are used in calculating the federal AMT.

Analysis
Among the adjustments provided by Neb. Rev. Stat. § 77-2716 are the exclusion from federal adjusted
gross income of interest or dividends from U.S. obligations as set forth in Individual Income Tax
Reg‑22‑002.05A and the inclusion of interest or dividends from non-Nebraska source state or local
obligations. Neb. Rev. Stat. § 77-2716 also provides for the exclusion from Nebraska taxable income
of any non-Nebraska income from an S corporation or limited liability company (LLC). Therefore, any
associated preference item derived from the S corporation or LLC included in the AMT calculations
should be excluded to the same extent in the Nebraska computation.
The specific line entries and the required adjustments in recalculating the minimum tax for the
2012 Nebraska Individual Income Tax Return, Form 1040N, are provided below. Recalculate all total
or computational lines to reflect adjustments made pursuant to this ruling. All other entries must
be the same as in the federal minimum tax computation.
2012 Federal Form 6251 (AMT - Individuals):
•

Line 1. If you itemized deductions, enter the amount from line 14, Nebraska Form 1040N, and
go to line 2, Form 6251. Otherwise, enter line 5, plus line 12, minus line 13 from Nebraska
Form 1040N, and skip to line 8, Form 6251.

•

Line 3. Enter the Federal Form 6251, line 3 amount, less the amount from line 8,
Form 1040N.

•

Line 7. Enter -0-.

•

Line 10. Enter any Nebraska net operating loss deduction included on line 57, Schedule I,
Form 1040N.

•

Line 11. Enter the alternative tax net operating loss deduction as adjusted for Nebraska purposes.

Nebraska Department of Revenue, PO Box 94818, Lincoln, Nebraska 68509-4818

Revenue Ruling 22-12-1

February 13, 2013

Page 2 of 2

•

Line 12. Enter only the tax-exempt interest from Nebraska private activity bonds issued after
August 7, 1986.

•

Line 31. If Part III of Form 6251 was used to make the line 31 entry, exclude any capital gains
in the calculation that were excluded on line 54 of Nebraska Schedule I.

•

Line 32. Enter -0-.

•

Line 34. Compute the regular federal income tax before credits on the Nebraska Tax Table
Income, line 14, Form 1040N. The same federal tax method used to complete line 44, Federal
Form 1040, must be used. Enter the computed amount without subtracting any foreign tax credit.

2012 Federal Form 1040A, Alternative Minimum Tax Worksheet:
•

Line 1. Add the amount from line 22, Form 1040A, and the amount from line 12, Form 1040N.
Subtract the amount entered on line 13, Form 1040N. Enter the result on line 1.

•

Line 20. If lines 9 through 19 were used to make the line 20 entry, exclude any capital gains in
the calculation that were excluded on line 54 of Nebraska Schedule I.

•

Line 21. Compute the regular federal income tax before credits on the Nebraska Tax Table
Income, line 14, Form 1040N. The same federal tax method used to complete line 28, Federal
Form 1040A, must be used.

•

Line 35 of the recomputed Federal Form 6251 or line 22 of the recomputed Federal Form 1040A,
Alternative Minimum Tax Worksheet, is to be entered in the appropriate area on line 16 of
Form 1040N. For taxpayers filing Nebraska Schedule III, enter this amount on line 73 of the
Nebraska Schedule III.

A copy of the recomputed Federal Form 6251, or Federal Form 1040A, Alternative Minimum
Tax Worksheet, must be attached to the Nebraska Individual Income Tax Return, Form 1040N,
when filed.
The AMT is to be recomputed for all taxable years beginning after December 31, 1978. Other revenue
rulings involving recomputation of Federal Form 6251, or the Federal Form 1040A, Alternative
Minimum Tax Worksheet, are shown below for the preceding three years:
2011 22-11-1;
2010 22-10-4; and
2009 22-09-1.
APPROVED:

Douglas A. Ewald
Tax Commissioner
February 13, 2013