Free Republic

Congress has been brought to a grinding halt by hardening Democratic and Republican stances on taxes and spending just days before lawmakers begin leaving Washington for Christmas and New Year’s. The two sides are, in some cases, refusing even to speak to each other about the massive omnibus and an Alternative Minimum Tax (AMT) bill. Senate Republicans refused to meet Democrats Tuesday on spending and House Democrats rejected the Senate’s AMT “patch,” preparing a new version paid for with corporate tax increases. Senate Minority Leader Mitch McConnell (R-Ky.) countered the majority’s plans with a proposal that would require Democrats to...

The Alternative Minimum Tax may be the all-time winner of Good Ideas Gone Bad award. Written to make sure tax-dodgers didn't pile up deductions to escape the IRS, it's now threatening to sweep in 25 million taxpayers, up from four million last year. This headache of a tax grew in scope thanks to inflation and rising incomes as lower-earners graduated into a higher tier. But it's also provided a stage for Congress to display a knack for feuding instead of fixing. The result could be a longer tax season, ample confusion and deepening voter resentment. Since it was passed in...

Chart: Percentage of taxpayers paying the alternative minimum tax, by townA federal tax originally designed to prevent the super-rich from avoiding taxes altogether continues to dun more and more of North Jersey, including thousands of families earning less than $100,000.  The latest data from the Internal Revenue Service shows a dramatic increase in the number of North Jersey families required to pay the alternative minimum tax, which produces higher bills than the regular income tax.  New Jersey is home to the highest percentage of AMT payers in the nation.There is general agreement in Congress that the AMT is growing...

Republicans have rejected a request by Majority Leader Harry Reid (D-Nev.) that the Senate approve by unanimous consent a one-year patch to the Alternative Minimum Tax (AMT) with no accompanying tax increases. Democrats quickly made political hay of the GOP move, which contradicted earlier Republican calls for extending tax relief with no offsets. Sen. Max Baucus (D-Mont.) blamed Republicans for obstructing tax relief, and called Reid’s request a “huge concession” on the part of Democrats. “If the AMT hits more taxpayers next year, it’s because of the Republican caucus. That’s clear,” said Baucus, who chairs the Senate’s tax-writing committee. Sen....

WASHINGTON, (AP) -- The Senate voted Thursday to block a looming tax increase averaging $2,000 for millions of taxpayers after Senate Republicans succeeded in thwarting a Democratic plan to also raise taxes on investors. The Senate bill, passed 88-5, provides a one-year fix for the alternative minimum tax but without matching the cost of the tax relief with new tax revenues. Without the fix, an estimated 25 million people would be subject to the higher AMT tax, up from 4 million in 2006. The Senate vote puts it at odds with the House, where Democratic leaders, under a principle of...

Taxes: For a supposed lame duck, President Bush has managed to shield the country from the Democratic Congress' price of new taxes to stop the alternative minimum tax. Standing for principle works wonders.High-ranking Democrats in Congress seem to have come to the conclusion that, as Elvis might have put it, you can knock middle-class taxpayers down, step in their face, slander their names all over the place. Just don't step on their blue suede tax-refund checks. The Treasury Department has warned that the longer Congress delays fixing the AMT, the later some $75 billion in refunds, averaging thousands of dollars...

This morning President Bush gave a Conference to the press in the James S. Brady Press Briefing Room Transcript> Enoy your visit to Sanity Island

WASHINGTON, (AP) -- The Senate on Tuesday failed to come up with a plan for blocking an unpopular tax that could affect millions of taxpayers and already is causing disruptions in preparations for the upcoming tax filing season. Senate Democratic and Republican leaders, while agreeing that Congress must act immediately to stop the alternative minimum tax from hitting some 25 million taxpayers in 2007, up from 4 million in 2006, mutually rejected plans from the other side on how to proceed. "We all know this is a pernicious tax, a stealth tax," Senate Finance Committee Chairman Max Baucus, D-Mont., said....

WASHINGTON (AP) -- Silena Davis had counted on an early tax refund to pay for getting her teeth fixed. Now, because Congress has dawdled all year on a tax bill, she and millions of other early filers could have to wait extra weeks for refunds that last year averaged $2,291. The Internal Revenue Service is looking hard at delaying the start of its filing season, set to kick off on Jan. 14, if Congress fails to pass legislation in the next two weeks. At issue is how to handle what could be a dramatic increase in the number of people...

Hi, my name is Annabelle, and I'm a taxaholic. It's hard for me to admit this, but I think it's time to own up: I'm powerless over the idea that taxes are not a bad way to fund programs that might do some good for our country. My addiction has really gotten the better of me now that Bush has vetoed Congress's main social spending bill, which was to fund admittedly unworthy social endeavors like cancer research, mine safety, job training and Head Start. I'm sure you've all heard this tale over and over again. My problem started at parties...

Charles Rangel has offered up his prescription for tax reform. He refers to it as “The Mother of All Tax Bills.” He claims that his bill restores tax fairness and makes the wealthy pay “their fair share.” This congressional balloon juice is not only disingenuous, it is also wrong. What Charlie Rangel proposes is the Mother of all unjustified pay cuts. By repealing the tax cuts passed by George W. Bush, Charles Rangel takes thousands of dollars out of the pockets of the average American wage earner. In the State of Virginia, Rangle’s Bill will cost the average family $2,487....

WASHINGTON -- Habitual congressional gridlock usually has no impact on the lives of ordinary Americans. But what happened on the Senate floor last Friday just before lawmakers recessed for their Thanksgiving break will delay tax refunds next year for some 50 million taxpayers who count on them. The underlying reason is a 38-year-old congressional tax blunder that never has been corrected. In 1969, Congress passed the alternative minimum tax (AMT) to collect from 155 tax-avoiding millionaires. But because the scheme was not indexed for inflation, this year alone it would hit 23 million extra people with taxes higher than intended....

WASHINGTON (AP) -- President Bush demanded Saturday that Congress send him legislation that keeps middle-class Americans from being hit at tax time next year by the dreaded alternative minimum tax. Bush says because the IRS had to send 2007 tax forms to be printed before AMT is resolved, many forms will be wrong. That's not likely to happen anytime soon. Congress has adjourned for the Thanksgiving holiday. The legislation is muddled in the House and Senate. And Bush has threatened to veto any bill that raises taxes as a way of fixing the tax, known in shorthand as AMT. "I...

President Bush demanded Saturday that Congress send him legislation that keeps middle-class Americans from being hit at tax time next year by the dreaded alternative-minimum tax. That's not likely to happen anytime soon. Congress has adjourned for the Thanksgiving holiday. The legislation is muddled in the House and Senate. And Mr. Bush has threatened to veto any bill that raises taxes as a way of fixing the tax, known in shorthand as AMT. "I will veto any bill that raises taxes as a condition of fixing the AMT," Mr. Bush said in his weekly radio address. "Members of Congress must...

...Internal Revenue Service officials warn that millions of people may face delays in having their returns processed next year and getting billions of dollars in refunds. The problem: Congress still hasn't approved temporary relief for many people from the alternative minimum tax, or AMT... Some lawmakers predict Congress probably won't take action until next month. If so, that could spell major trouble, Treasury and IRS officials warn. That's because it takes time for the IRS to reprogram its computerized processing systems to reflect last-minute changes made in Congress, says Terry Lemons, an IRS spokesman... "As we look at the upcoming...

Nov. 12, 2007 (SmartPros) -- The U.S. Chamber of Commerce expressed its disappointment over the Temporary Tax Relief Act of 2007, passed by the House on Friday. The nearly $80 billion bill includes provisions that provide alternative minimum tax relief, and extends a number of tax provisions set to expire this year. The bill is not "tax relief" as advertised in its title, the Chamber said, but a tax shift from individual taxpayers to businesses, putting American jobs and the economy at a disadvantage compared with our growing global competitors. "While the Chamber supports an extension of alternative minimum tax...

WASHINGTON -- Capping a spirited debate, the Democratic-led House voted Friday to shield more than 23 million Americans from a tax hike this year under the alternative minimum tax -- and hit up wealthy managers of private equity firms and hedge funds to make up the difference. The 216-193 vote, which fell largely along party lines, escalated an emerging political war over tax fairness and the proper treatment of an elite class of investment managers who have benefited from the tax cuts of recent years. It sparked angry Republican charges that Democrats were rushing to approve ill-advised tax hikes. For...

Fiscal Policy: To stop the Alternative Minimum Tax from imposing a big tax increase, Democrats are pushing — you guessed it — a big tax increase. Republicans have a better fix: taxpayer choice.For the past couple of years, congressional Democrats have surprised many by actually discovering a tax they don't like. The AMT was cooked up in 1969, when the federal income tax system was far more convoluted than today, as a means of preventing a tiny handful of fewer than 200 high-income households from using deductions to avoid all or almost all income tax liability. Unindexed for inflation, this...

WASHINGTON — For the first time since 2001, it’s not clear that Congress will pass an annual temporary “patch” in time to prevent the creeping Alternative Minimum Tax from forcing up tax payments for millions of unsuspecting middle-class taxpayers. In addition, if Congress doesn’t “patch” the AMT tax within 10 days — and it appears highly unlikely to do so — then the partisan bickering among lawmakers could delay tax refunds next year for tens of millions of Americans. Democrats in control of Congress pledge to do as Republicans have done in recent years and prevent the AMT from hitting...

The House's top Democratic tax writer outlined a $1 trillion plan Thursday to eliminate the alternative minimum tax and ease the tax burdens of most people by asking the rich and some companies to pay more. ''We have attempted to restore equity and fairness to the system,'' said Rep. Charles Rangel, chairman of the House Ways and Means Committee... House GOP leader John Boehner of Ohio said the ''mother of all tax hikes'' would ''doom our economy'' and put people out of work. The second-ranking House Republican, Rep. Roy Blunt of Missouri, said his party would use the proposal to...