Taking Money Out of the AMT
Carmen and Tracy Coenen, a forensic CPA with Sequence Inc., explain how the alternative minimum tax -- which was originally designed in the 70s to tax those who were considered wealthy by the standards of those days but now squeezes the middle class -- has been patched in the bailout bill passed today.
With this patch, less people will qualify for the AMT (in this case, not qualifying is good). The minimum required salary to qualify for the AMT in 2008 will be about $100k for single filers and $175k for joint filers.
They also explain an exemption provision in the bill of $46,200 for individuals and $77,000 does not correlate to one's income and taxpayers probably should ignore it, as it is confusing.
For more about the AMT, visit Tracy's site Sequence Inc., where she has more information on that and other areas of her expertise.