Posted on 04/15/2005 11:21:21 AM PDT by seacapn
WASHINGTON -- Every April 15, Americans are reminded just how much they dislike paying taxes on their income. Philip Priddy is still paying off a $220,000 tax bill on money he never made.
Priddy, a Baton Rouge sales manager for Nortel, was forced to liquidate his savings, sell his boat and his wages are still being garnisheed by the Internal Revenue Service to pay off his debt. Although an extreme example, he is among a fast-growing segment of Americans who are feeling the pinch of the Alternative Minimum Tax, or AMT.
The tax originated in the late 1960s to target super-rich people who employed clever accountants to shield their income from the long arm of the IRS. But because it hasn't kept pace with wage inflation, the U.S. Treasury estimates that 3.8 million Americans this year will have to pay an AMT on top of their regular income taxes.
Most are upper-middle-class people making a comfortable living, but that will soon change, according to the Congressional Budget Office. By 2010, the agency said, nearly 30 million Americans -- 20 percent of all taxpayers and 40 percent of married couples -- will have to pay the extra tax. By then, it will hit two-thirds of taxpayers with adjusted gross income between $50,000 and $100,000, the agency projected.
(Excerpt) Read more at nola.com ...
This should be a shot across the bow for Repulicans - once big chunks of the country start getting attacked by this tax, they will look at who was in power and did nothing to prevent it. And there will be a political reckoning.
The problem with that theory, is that most of them live in New York and California.
You are a 100% correct!
"By 2010, the agency said, nearly 30 million Americans -- 20 percent of all taxpayers and 40 percent of married couples -- will have to pay the extra tax. By then, it will hit two-thirds of taxpayers with adjusted gross income between $50,000 and $100,000, the agency projected."
If this is the case, then repealing the AMT should be a no-brainer. Any Republican that thinks that doing so would be a political loser is either an idiot or crooked.
Most of them NOW live in New York and California, you mean.
This thing is spreading like a virus.
One possible AMT effect - eliminate charitable spending, because those deductions can come back to hurt you in the AMT scheme.
Republicans control the house, senate, and presidency.
It would be willful ignorance or malice on their part not to fix this problem now. People won't just forget when their savings are getting drained away by the IRS.
That's another thing - this tax is a huge marriage penalty.
New York and Boston area----brutal real estate,as everyone knows.
Charitable deductions are not an AMT addback. See form 6521 and the associated instructions.
Meaning, of course, they won't fix it. Like the border situation, right?
AMT totally sucks. Complete low hanging fruit if only the GOP could develop a set ...
Your assuming that they somehow don't want the money.
They all see it coming , but they know they can dodge direct blame and may even get to buy a few votes for themselves with a few of those bucks.
When will people realise that it's not a matter of "inaction" that lets "bad" things happen ... it's a result of policy, active pursuit of a goal.
Until we change the people in the positions, the policys won't change.
The AMT is the perfect manifestation of what really happens when the Dems say "tax the rich:" we all get screwed eventually, particularly when what was "super rich" in the 1960s is moderate income in this millenium.
I just saw a story on the local news showing how a guy with six kids unexpectedly found himself sucked into the AMT, and had to pay an additional $2600 in taxes. Just what a guy with six kids needs!
And the Congress has no stones to fix it, because, as the story quoted "they would stand to lose $11 billion in tax income!" Gee, sorry about that guys. We'll just tell the guy with six kids that their teeth will have to stay crooked, or he will have to drive the 1984 minivay for another few years! Just so long as the likes of Robert Byrd can porkbarrel his way to getting his name on another $300K outhouse in the woods of West Virginia somewhere!
Isn't it about time that they changed the name of West Virginia to Byrdistan or something?
To paraphrase Pogo, "we have seen the rich, and they is us!"
PURE BS! THe politicians knew that this tax would ensnare middle class taxpayers when they instituted it. Just like just like the regular federal income tax itself. It started out as a 1% tax on the "super-rich". Now it hits nearly everyone. And watch out for creeping FICA which was indexed to the CPI. Since wages are not keeping pace, soon everyone will pay FICA on 100% of their income too.
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