Form 3510: Credit for Prior Year Alternative Minimum Tax
Form FTB 3510, titled "Credit for Prior Year Alternative Minimum Tax — Individuals or Fiduciaries," is used by California taxpayers to claim a credit for Alternative Minimum Tax (AMT) paid in a prior year. This form is specifically designed for individuals and fiduciaries who had an AMT credit carryover from the previous year or paid AMT in the prior year due to adjustments and tax preference items (excluding exclusions).
Who Must File Form 3510?
- Individuals and fiduciaries who had an AMT credit carryover from 2024.
- Taxpayers who paid AMT in 2024 and had adjustments and tax preference items (other than exclusions).
- Corporations must use Schedule P (100 or 100W) to claim the credit, not Form 3510.
How to Use Form 3510
Use Part I of Form 3510 to determine the amount of 2024 AMT attributable to deferral preferences and the amount available as a credit in 2025. The form requires you to complete specific lines based on your California tax return type (Form 540, 540NR, or 541).
Key Line Instructions
- Line 1: Estates and trusts skip lines 1–3. Complete a second Schedule P (541), Part I and Part II, including only exclusion items.
- Line 2: Enter adjustments and tax preference items treated as exclusions.
- Line 3: Calculate the 2024 AMT Credit Net Operating Loss Deduction (AMTCNOLD) using R&TC Sections 17276.2, 17276, 17276.21, 17276.22, and 17276.24.
- Line 4: If line 4 is zero and you paid AMT in 2024, all AMT is attributable to deferral preferences. Enter -0- on line 13 and proceed to Part II.
- Line 32: If the amount is zero or less, no AMT credit is available. If more than zero, enter the amount and carry it forward to Schedule P (540, 540NR, or 541).
Exemptions and Credits
- Residents: Enter exemption credits from Form 540, line 32 (or Form 541, line 22) on line 34.
- Nonresidents/Part-Year Residents: Enter exemption credits from Form 540NR, line 39 on line 34.
Tentative Minimum Tax
Line 36 requires entering the tentative minimum tax from one of the following forms:
- Schedule P (540), Part II, line 24
- Schedule P (540NR), Part II, line 43
Important Notes
- California conforms to federal rules for certain provisions, including the child tax credit for investment income under the Small Business and Work Opportunity Tax Act of 2007.
- California does not allow percentage depletion for specified natural resources (coal, oil shale, oil and gas wells) for taxable years beginning on or after January 1, 2024.
- Intangible drilling and development costs are not deductible for oil and gas wells paid or incurred on or after January 1, 2024.
Source:
Form FTB 3510 Instructions
Disclaimer: Always verify details with official Federal or State Department of Revenue Forms and Instructions.