Posted on 11/05/2012 7:34:10 AM PST by Timber Rattler
The best hope for a deal to avoid the “fiscal cliff” may lie with the alternative minimum tax, an obscure provision of the tax code that is about to become alarmingly relevant to millions of middle-class taxpayers.
Unless Congress acts by the end of the year, more than 26 million households will for the first time face the AMT, which threatens to tack $3,700, on average, onto taxpayers’ bills for the current tax year. Because those people have never paid the AMT, they have no idea they are in its crosshairs — put there by a broader stalemate over tax policy that has kept Congress from limiting the AMT’s reach.
Forget about the much-publicized tax hikes set to take effect for 2013 — if you have a couple of children and annual income over $75,000, chances are good that your taxes are on track to go up substantially for 2012.
(Excerpt) Read more at washingtonpost.com ...
But...but...but...0bama promised no tax hikes on anyone making less than $250,000! He promised us!
Any idiot who believed that and voted accordingly should be taxed to the max. They are too stupid to be allowed to have money.
And this same WaPo and their ilk will lay the blame on President Romney.
The makers of the AMT knew what they were doing. They deliberately didn’t index it to inflation. They knew that it would seize more and more people in its marxist jaws.
They know what inflation is. They have indexed their salary, benefits, and pension to inflation.
The WaPo doesn’t understand the meaning of middle class. No one with an income under $82K is likely to be impacted. That is the start of the top fifth in household income. Nearly all of those impacted will have a household income over $113K, which puts them in the top 10%.
So, the rich are going to be taxed. That’s what they wanted, right?
” Ticking time bomb for the Middle Class... “
Thanks for posting this. Many folks are unaware of it, but they soon will be.
This is what happens when Washington wants the rich to pay their fair share.
That ticking time bomb hits joint filers who make $45,000 or more.
Do your homework and take a look at all the taxes that will have their rates increase plus all the new taxes that are due to kick in on Jan 1.
Also pay attention to the new death tax provision. The exclusion goes from 5 Million to 1 Million with a 55% tax rate for everything over the 1 million. And believe me, the IRS accounts for everything when placing a value on your estate.
Also pay attention to the new death tax provision. The exclusion goes from 5 Million to 1 Million with a 55% tax rate for everything over the 1 million. And believe me, the IRS accounts for everything when placing a value on your estate.
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By putting the estate in a trust one avoids this, yes?
does it it filesr for this year at 45K or the 2013 return
A bypass trust is one way to avoid this. I am trying to get the warning out especially to people who don’t know what their net worth is. Also, your other question about when the AMT kicks in, it will apply to anyone making over $45K and will apply to income made in 2013. A huge pile of tax increases kick in on Jan 1 of ‘13, but the pain won’t be realized until April of ‘14.
Boy and 13 was the year I was going to take my retirement fund and pay off the house. But that would all be income. Funny that it wouldnt slide from one asset type to another.
With my ins for the next few years I would be over the estate limit. A few years ago I talked to lawyers about a living trust and they discoruaged me.
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