The PositiveLights.org Web Site

 

The alternative minimum tax (AMT) was designed to prevent wealthy taxpayers from eliminating their tax entirely through the use of various tax shelter deductions or credits. The 1986 tax law substantially eliminated the use of tax shelters but the AMT was not repealed. Since 1986, inflation and tax law changes have pushed taxpayers into the AMT, but the thresh hold for the AMT has not kept pace. There has been some political pressure to repeal the AMT but not enough to make it happen.  Taxpayers may become subject to the AMT when their total tax liability (for 2003) exceeds $40,250 for single taxpayers $58,000 for married taxpayers filing jointly Generally, the AMT is triggered when the taxpayer has substantial business deductions, itemized deductions, personal exemptions, tax credits and some investment related deductions.  In addition, the lowest tax bracket for the AMT is 26% while the lowest bracket for the regular tax is just 10%. Because the AMT is a complete alternative system of taxation, it can't be explained accurately in a short article such as this. As time permits, this web page will be expanded to include further details about the AMT and links to other web pages that discuss the subject.

Copyright, 2003, Vernon K. Jacobs

Vernon Jacobs is the Editor/Publisher of The International Wealth Protection Reports, which are a collection of research reports on legal methods of asset protection and tax avoidance. Further information on this subject is available at http://www.offshorepress.com/  Jacobs is a CPA who has worked as a free lance tax and financial author/editor since 1977. Details about his credentials and experience are online at http://www.offshorepress.com/vkjcpa/  

ElderTax Index