What is difference between tentative minimum tax and the amt

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1. What is the difference between the tentative minimum tax (TMT) and the AMT?

2. Lee is single and he runs his own business. He uses the cash method of accounting to determine his business income. Near the end of the year, Lee performed work that he needs to bill a client for. The value of his services is $5,000. Lee figures that if he immediately takes the time to put the bill together and send it out, the client will pay him before year-end. However, if he doesn't send out the bill for one week, he won't receive the client's payment until the beginning of next year. Lee expects that he will owe AMT this year and that his AMT base will be around $200,000 before counting any of the additional business income. Further, Lee anticipates that he will not owe AMT next year. He anticipates his regular taxable income next year will be in the $200,000 range. Would you advise Lee to immediately bill his client or to wait? What factors would you consider in making your recommendation?

Reference no: EM13906011

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