Are you ready to pay another $3,000 to $5,000 next April in taxes? That's right, the AMT patch continues to be ignored by the Democrat-controlled Congress, which could mean a big tax hike THIS YEAR for middle-class Americans.
FoxNews.com - Taxpayers Anxiously Await Annual 'Patch' to Alternative Minimum Tax
The AMT is ridiculous to begin with, but when it was originally implemented in 1969, it affected very few people. Now there are millions of people that get it between the eyes with this every year.Of all the tax issues facing Congress when it returns for a lame duck session after the Nov. 2 midterm elections, the annual rite of patching the Alternative Minimum Tax will be the most urgent.
Unlike the debate over the Bush tax cuts, which will affect taxpayers' income in 2011, the AMT applies to 2010. And the delay in patching it is already causing problems and raising alarms for large numbers of middle-income taxpayers -- as many as 25 million Americans, according to one expert -- who could face a huge increase in their tax payments if Congress doesn't act.
Enacted in 1969, the Alternative Minimum Tax was originally aimed at 155 extremely wealthy taxpayers who had avoided paying federal taxes completely. It was an add-on tax designed to ensure that everyone paid some income tax every year. Since then it has evolved into the primary tax mechanism for taxing high income taxpayers.
Under the original system, taxpayers who earned more than $200,000 -- a very high income 30 years ago -- were required to calculate their taxes differently, resulting in a larger tax payment for the wealthy.
However, the amount has never been adjusted for inflation in its 40 years.
$200,000 a year ain't much, especially if you have kids and live in New York or California. Anywhere for that matter. It's not 1969 anymore, folks.
This is why you don't give government more power. They never give an inch back. It simple common sense that you would adjust this for inflation over the years, right? Of course not, if you're a drunken-spending government that's cornered itself by its juvenile lack of financial responsiblility.