"The single most serious problem with the tax code"
In order to find out whether or not you owe Alternative Minimum Tax (AMT), you must complete a complicated worksheet, read 9 pages of instructions, and fill out a lengthy form.
Simplify this process by scheduling a consultation today! We can help you control or reduce the affect of the AMT on your 2007 tax return. Don't be one of the new 19 to 20 million taxpayers surprised by the AMT next year.
Introduced by the Tax Reform Act of 1969, the Alternative Minimum Tax (AMT) was aimed at tax dodgers and some high-income families who were able to use numerous tax benefits to pay little or no income tax at all. However, since it does not keep up with inflation, the AMT is affecting more and more upper-middle-income taxpayers every year. The Congressional Budget Office issued a brief (No. 4, April 15, 2004) which estimated that, "in 2010, if nothing is changed, one in five taxpayers will have the AMT liability." Based on the taxpayer's adjusted alternative minimum taxable income, the AMT has a set minimum tax rate of 26% or 28%. The Alternative Minimum Tax is also affecting some corporations, setting their rate at 20%.
The majority of the taxpayers who owe AMT aren't even aware they must pay it because of how complicated the rules are. They do not allow certain deductions and exemptions that are normally allowed when calculating your regular income tax liability.
According to The 360 Degrees of Financial Literacy Web site, some things that might make you liable for the AMT include:
- Large numbers of personal exemptions
- Large deductible medical expenses
- Large deductions for state, local, personal property, and real estate taxes
- Home equity loan interest where the financing isn't used to buy, build, or improve your home
- Exercising a large incentive stock option
- Large amounts of miscellaneous itemized deductions, such as employee business expenses which have not been reimbursed
Don't Let the Alternative Minimum Tax Surprise You
Call today to schedule a consultation and find out if you must pay Alternative Minimum Tax!
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