Including the new tax when you compare your regular tax liability against potential AMT would protect many high-income taxpayers from having to pay the alternative tax.
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No more Earned Income Credit, no Minimum Alternative Tax, Child Tax Credit, Marriage Tax Penalty, Employer Plan Covered restrictions, and other pointless regulations that make the system a complete mess.
But while Mr Obama has plans to simplify tax filing and Mr McCain talks vaguely of an optional alternative tax with lower rates and a broader base, neither really focuses on reform.
No matter how much you wiped out your income with exotic tax perks like intangible drilling costs and other tax-shelter sounding items, you paid a smaller alternative tax rate on virtually everything with no deductions.
The GOP opposition to any kind of tax rate increase has stalled deficit negotiations for two years and led to unusual political drama, such as McConnell recently filibustering a proposal he introduced and Thursday night's rebuff by House Republicans of the alternative tax plan pushed by Boehner, their leader.
The many adjustments to income permitted by the tax code, plus alternative tax rates on the largest sources of income of the wealthy, explain why the average federal income tax rate on the 400 richest people in America was 18.11 percent in 2008, according to the Internal Revenue Service , down from 26.38 percent when these data were first calculated in 1992.
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Furthermore, either regular income tax or alternative minimum tax may be payable at the time of exercise, even if the underlying stock is subsequently sold at a loss.
The corporate income tax would be replaced with an 8.5% border adjustable business consumption tax and the alternative minimum tax (AMT) and the estate tax would be repealed.
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On the tax side, Romney promises to extend the Bush-era tax cuts, then cut individual rates by 20 percent across the board, repeal the estate tax and the Alternative Minimum Tax, and repeal the tax hikes in the 2010 health law.
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Davis warns that the estate tax, like the alternative minimum tax, could lead to unintended estate tax liabilities.
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At the top of Olson's list of concerns was perhaps the nation's most famous hidden tax--the alternative minimum tax (AMT).
Look at what happens in 2015 under current law (that is, assuming all the Bush-era tax cuts and the Alternative Minimum Tax patch expire).
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In the short term millions of Americans face a federal tax hike, already programmed into the tax code, from the alternative minimum tax.
And before you distribute a penny, ask your tax accountant to calculate the impact on your state tax bill and your federal alternative minimum tax liability.
Another thing Washington should do but is currently incapable of doing is to substantially cut individual and corporate income tax rates and eliminate the alternative minimum tax.
Back in 1976, amid a flurry of concern over millionaires who used shelters and loopholes to escape any tax, Congress raised the alternative minimum tax rate and ordered the IRS to report how many wealthy folks pay nothing each year.
He also suggested retroactive tax changes to the individual alternative minimum tax (AMT) that could put cash in the hands of folks who operate their businesses as "pass-throughs, " meaning that they report all business income and credits on their personal tax returns.
The most surprising tax trap on fees is the Alternative Minimum Tax.
While lowering the regular tax rates, they allowed the alternative minimum tax to recapture much of those tax revenues from a lot of upper-middle-class people.
One year tax credits were able to offset the alternative minimum tax in the annual fix passed by Congress.
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For such stock, no portion of the exclusion is treated as a tax preference item for purposes of the alternative minimum tax.
The Republican-controlled House has passed an economic stimulus package that includes new corporate tax cuts, including elimination of the alternative minimum tax on corporations.
However, for tax filers who are subject to the alternative minimum tax, home-equity interest deductions are allowed only when that debt is spent on home improvements.
On top of his original plan, Romney proposed cutting all ordinary income tax rates by 20 percent and eliminating the Alternative Minimum Tax.
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It includes tax breaks, disaster relief, clean energy tax incentives and a fix to prevent the alternative minimum tax from hitting more than 20 million additional people in 2008.
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The tax bill should also include permanent indexation of the Alternative Minimum Tax retroactive to January 1, 2012.
But until 2005, this foreign tax credit could offset only 90% of the alternative minimum tax they owed.
All of these numbers are relative to the tax rules in place in 2012 with a patched Alternative Minimum Tax and the payroll tax cuts still in place but with the Obamacare tax increases not yet in effect.
Other elements central to the negotiation that would impact middle income earners, mainly the extension of Bush era tax cuts for incomes below the border, patching the alternative minimum tax, and the potential loss in the payroll tax cut, suggest that the economic situation of the middle class as a result of the fiscal reorganization will remain the status quo at best.
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