Instructions for Form 4626 - Alternative Minimum Tax—Corporations

Sep 19, 2026

Upload by Asher

Instructions for IRS Form 4626 cover how a corporation determines alternative minimum tax (AMT) under section 55 when the corporation is not exempt. The guidance explains the purpose of Form 4626, which corporations must file, and how AMT is handled for consolidated affiliated groups. It details the small corporation exemption criteria, gross receipts calculations, rules for losing small-corporation status on a change date, and related recordkeeping expectations.

LanguageEnglish

CategoryForms

FormatPDF

Pages12

Reading Time4 min

AccessFree to download

Purpose of Form

Who Must File

Exemption for Small Corporations

Loss of small corporation status

Credit for Prior Year Minimum Tax

Recordkeeping

2016 Instructions for Form 4626 Alternative Minimum Tax—Corporations Department of the Treasury Internal Revenue Service Section references are to the Internal Revenue Code unless otherwise noted. Future Developments For the latest information about developments to Form 4626 and its instructions, such as legislation enacted after they were published, go to [www.irs.gov/form4626](www.irs.gov/form4626) . General Instructions Purpose of Form Use Form 4626 to figure the alternative minimum tax (AMT) under section 55 fora corporation that is not exempt from the AMT. Consolidated returns. For an affiliated group filing a consolidated return under the rules of section 1501, AMT must be figured on a consolidated basis. Who Must File Generally, file Form 4626 if any of the following apply. The corporation is not a “small corporation” exempt from the AMT (as explained below) . The corporation's taxable income or (loss) before the net operating loss (NOL) deduction plus its adjustmentsand preferences total more than $40,000 or, if smaller, its allowable exemption amount. The corporation claims any general business credit, any qualified electric vehicle passive activity credit from prior years, or the credit for prior year minimum tax. Exemption for Small Corporations A corporation is treated as a small corporation exempt from the AMT for its current tax year if: 1. The current year is the corporation's first tax year in existence (regardless of its gross receipts for the year), or 2. Both of the following apply. a. It was treated as a small corporation exempt from the AMT for all prior tax years beginning after 1997. b. Its average annual gross receipts for all 3-tax-year periods (or portions thereof during which the corporation was in existence) ending before its current tax year did not exceed $7.5 million ($5 million for the corporation's first 3-tax-year period) . See section 55(e) . The following rules apply when figuring gross receipts under 2b above. Gross receipts must be figured using the corporation's tax accounting method and include total sales (net of returns and allowances), amounts received for services, and income from investmentsand other sources. See Temporary Regulations section 1.448-1T(f)(2)(iv) for more details. Gross receipts include those of any predecessor of the corporation, including non-corporate entities. For a short tax year, gross receipts must be annualized by multiplying them by 12 and dividing the result by the number of months in the tax year. The gross receipts of all persons treated as a single employer under section 52(a), 52(b), 414(m), or 414(o) must be aggregated. Loss of small corporation status. If the corporation qualified as a small corporation exempt from the AMT for its previous tax year, but does not meet the gross receipts test for its current tax year, it loses its AMT exemption status. Special rules apply in figuring AMT for the tax year beginning on the “change date.” The change date is the first day of the corporation's tax year for which the corporation ceased to be a small corporation. Where this applies, complete Form 4626 taking into account the following modifications. The adjustments for depreciation and amortization of pollution control facilities apply only to property placed in service on or after the change date. The adjustment for mining exploration and development costs applies only to amounts paid or incurred on or after the change date. The adjustment for long-term contracts applies only to contracts entered into on or after the change date. When figuring the amount to enter online 6, for any loss year beginning before the change date, use the corporation's regular tax NOL for that year. Figure the limitation on line 4d only for prior tax years beginning on or after the change date. Enter zero on line 2c of the Adjusted Current Earnings (ACE) Worksheet. When completing line 5 of the ACE Wor

FAQs

What is the purpose of IRS Form 4626?

Use Form 4626 to figure a corporation’s alternative minimum tax (AMT) under section 55 when the corporation is not exempt from the AMT.

When does a corporation qualify for the small corporation exemption from AMT?

A corporation is treated as a small corporation exempt for its current tax year if it is in its first tax year of existence, or if it was exempt for all prior tax years beginning after 1997 and its average annual gross receipts do not exceed the stated thresholds.

What happens if a corporation loses small corporation status?

If the corporation fails the gross receipts test for its current tax year, it loses its AMT exemption status, cannot qualify for any subsequent tax year, and must complete the form using change-date modifications.

Sep 19, 2026

Upload by Asher