Deductions, AMT, and Taxable Income Computation

This chapter moves from AGI to taxable income and related payment obligations. The main TCP task is to understand where deductions belong, which limitations apply, and how alternative systems like AMT or estimated-tax rules affect the final answer.

In This Chapter

• Business Versus Personal Deductions and QBI covers classification of expenses, home-office issues, and the QBI deduction.
• Itemized Deductions and Charitable Strategies explains SALT, medical, and charitable deduction planning.
• AMT Mechanics and Planning addresses the parallel AMT framework and common triggers.
• Estimated Tax Payments and Underpayment Penalties covers safe harbors, required payments, and penalty exposure.

How to Use This Chapter

• Read this chapter after Chapter 3 so the gross-income and AGI framework is already in place.
• Focus on what changes deductibility, AMT exposure, or payment timing.
• Return here whenever a TCP question moves beyond the income base into deductions, liability, or penalty risk.

In this section

• Business Versus Personal Expense Classification and the QBI Deduction
  Expense-classification guidance covering home-office issues and the qualified business income deduction.
• SALT, Medical, and Charitable Deduction Planning
  Itemized-deduction treatment for SALT, medical expenses, charitable giving, and related planning.
• Alternative Minimum Tax Mechanics, Adjustments, and Planning
  Alternative minimum tax mechanics, preference items, adjustments, and planning considerations.
• Estimated Tax Safe Harbors and Underpayment Penalty Planning
  Estimated-tax safe harbors, required-payment rules, and underpayment penalty planning.