Alternative Minimum Tax (AMT)

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Alternative Minimum Tax (AMT)



Finally, today's tax management issues are complicated by the creep of Alternative Minimum Tax (AMT). The tax code requires taxes to be computed under two formulas, the regular tax code, and the AMT schedule. You must pay according to whichever system generates a higher number. Originally, AMT was created to make sure the "super wealthy” paid their fair share, but now inflation has brought millions of people into AMT in a way never intended. Both political parties talk about the importance of reforming AMT but agreeing on how to change it has been difficult.

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