Alternative Minimum Tax

[gPink]

Just a heads up since the tax year is coming to a close. With the idiots in congress (both sides/none excluded) getting ready for another monumental pissing contest, the annual 'patch' might not get passed.
Whether by design or neglect, which will be irrelavant to almost 40 million new victims of this insidious tax, if congress fails to act, this so-called 'fiscal cliff' bomb will hit the middleclass dead center. If you are unaware or unfamiliar with the AMT, do your homework now. The threshold is 75k now, I think. Not indexed to inflation, no deductions etc. I am not a CPA. Not offering advice. Just a caution.

[twowheeladdict]

What is the range for middle class these days?  I know I pay as much in taxes every year as I grossed the first year in my career. 

[VirginiaJim]

http://www.irs.gov/uac/Six-Facts-the-IRS-Wants-You-to-Know-about-the-Alternative-Minimum-Tax

It's very confusing as most things are to me, but I think it has to do with someone having a large number of tax deductions or credits...something I don't usually qualify for....yet.

[gPink]

Yes, it is confusing. Originally the law was passed in 1969 because it was found that there was 155 people in the country who were making 200,000+ and not paying any taxes due to 'loopholes' and deductions. Since it was not indexed to inflation it has swallowed more and more people into it's coverage. My fear now is that the Pols will see it as a way to increase tax revenue and be able to retain the ability to say 'We didn't raise tax rates'. Congress finding a way to pick up a turd by the clean end.

[Cholla]

The proper term is, "we didn't raise taxes but we generated new revenue".
And there is no such thing as a tax loophole. If you followed the tax code you did nothing shady or illegal.

[twowheeladdict]

The proper term is, "we didn't raise taxes but we generated new revenue".
And there is no such thing as a tax loophole. If you followed the tax code you did nothing shady or illegal.

Loophole -> An ambiguity or inadequacy in the law or a set of rules.

So, nothing shady or illegal.  Just someone taking advantage of a poorly written law.  Still a loophole though because it was not part of the intention of the drafters of that law to allow for that particular deduction or avoidance because they did not know it was there.

[Cholla]

Or it was written that way intentionally. It looks like they really wrote a tough code but wrote IN the ambiguity.
Trust me, there are no loopholes. If it's there that's the way they want it.
Then they vilify it with term, "taking advantage of a loophole". But they follow the code to the letter of the law. But, that's diiiiiferent.