Fixing the AMT problem

[CADsortaGUY]

No Deal on Alternative Minimum Tax

Now what I don't understand is why the Senate doesn't put up a bill that only addressed the AMT. If they would add this/that/the other thing to it - it'd pass in a heartbeat. Why doesn't Reid put partisanship asside for once and do the right thing to get rid of/ change the AMT? IMO, the longer the Senate plays politics with it - the worse it's going to be for them. Just do your damn job already and pass legislation that fixes it without attaching other strings.

Update: Dems content with pending tax hike?

 

[theeedude]

Because it has to be revenue neutral so it doesn't add to the deficit.

 

[Pabster]

This could be a real mess.

IRS says they need 7 weeks to program in any software changes, get new publications and forms printed, et al.

If nothing changes, a lot of people are gonna be stung hard. And the blame game will begin...

 

[Craig234]

I think Senseamp nailed it.

Funny how only one side is 'playing politics'.

I'm not sure of the exact distribution of the AMT, but perhaps the dems feel it's better to leave it in place in the short term as it creep down too low, in the interest of slightly reducing the terrible Republican policy of hugely excessive borrowing instead of balancing the budget. I can't blame them a bit for that if it's the case since Republican block any fiscal responsibility.

But it would be good to see the AMT fixed, indexed to inflation, and the tax rates fixed as well, i.e., some of the cuts for the top below the levels needed for fiscal responsibility repealed.

 

[CPA]

Originally posted by: senseamp
Because it has to be revenue neutral so it doesn't add to the deficit.

Here we go again. The AMT was not supposed to be applied against this low level of income. It is not adjust for inflation. So why is it necessary to be revenue neutral?

 

[CPA]

Originally posted by: Craig234
I think Senseamp nailed it.

Funny how only one side is 'playing politics'.

I'm not sure of the exact distribution of the AMT, but perhaps the dems feel it's better to leave it in place in the short term as it creep down too low, in the interest of slightly reducing the terrible Republican policy of hugely excessive borrowing instead of balancing the budget. I can't blame them a bit for that if it's the case since Republican block any fiscal responsibility.

But it would be good to see the AMT fixed, indexed to inflation, and the tax rates fixed as well, i.e., some of the cuts for the top below the levels needed for fiscal responsibility repealed.

25M taxpayers. That's the distribution. And yep, I'm one of them if this doesn't get fixed. And, no, I'm not rich, I'm not in the top 5% of all earners, believe me.

 

[CPA]

Baucus rejected that plan but said it was a constructive beginning. Reid, accusing Republicans of stalling so Democrats would get blamed for failing to act on the AMT, moved to hold a vote, probably on Thursday, on cutting off debate and proceeding to the House bill.


bwahahahahaaha, cry me a river Reid, of course, it's the Dems fault. You're playing a shell game using the "revenue neutral" mantra instead of understanding the money from this abomination of a tax was never meant to collected in the first place. Hey, here's a thought, if you would control your spending you wouldn't even have to worry about being revenue neutral, now would ya?

 

[CADsortaGUY]

Originally posted by: CPA

Originally posted by: senseamp
Because it has to be revenue neutral so it doesn't add to the deficit.

Here we go again. The AMT was not supposed to be applied against this low level of income. It is not adjust for inflation. So why is it necessary to be revenue neutral?

Why is it necessary? It isn't, but it's a good excuse(read "cover") for the dems to raise other taxes instead of lowering spending.

 

[1EZduzit]

Originally posted by: CADsortaGUY

Originally posted by: CPA

Originally posted by: senseamp
Because it has to be revenue neutral so it doesn't add to the deficit.

Here we go again. The AMT was not supposed to be applied against this low level of income. It is not adjust for inflation. So why is it necessary to be revenue neutral?

Why is it necessary? It isn't, but it's a good excuse(read "cover") for the dems to raise other taxes instead of lowering spending.

How are we going to lower spending with the inflation that we now have? And it's going to get worse too, look at the subsidy the taxpayers are going to have to shell out for the people who bought too much home and now can't pay for it.

 

[cliftonite]

Originally posted by: CPA
Baucus rejected that plan but said it was a constructive beginning. Reid, accusing Republicans of stalling so Democrats would get blamed for failing to act on the AMT, moved to hold a vote, probably on Thursday, on cutting off debate and proceeding to the House bill.


bwahahahahaaha, cry me a river Reid, of course, it's the Dems fault. You're playing a shell game using the "revenue neutral" mantra instead of understanding the money from this abomination of a tax was never meant to collected in the first place. Hey, here's a thought, if you would control your spending you wouldn't even have to worry about being revenue neutral, now would ya?[

Hard to control spending when the command in chief requests tens of billions every now and then for his false war isnt it?

 

[Craig234]

Originally posted by: CPA

Originally posted by: Craig234
I think Senseamp nailed it.

Funny how only one side is 'playing politics'.

I'm not sure of the exact distribution of the AMT, but perhaps the dems feel it's better to leave it in place in the short term as it creep down too low, in the interest of slightly reducing the terrible Republican policy of hugely excessive borrowing instead of balancing the budget. I can't blame them a bit for that if it's the case since Republican block any fiscal responsibility.

But it would be good to see the AMT fixed, indexed to inflation, and the tax rates fixed as well, i.e., some of the cuts for the top below the levels needed for fiscal responsibility repealed.

25M taxpayers. That's the distribution. And yep, I'm one of them if this doesn't get fixed. And, no, I'm not rich, I'm not in the top 5% of all earners, believe me.

25M is not a distribution. What is the range of income of the 25M, how much more tax will they pay than if this were repealed, where does this 25M fit in to the total base?

Again, I'm in favor of fixing this, but I'm also interested in the large debt problem we have.

 

[fskimospy]

Originally posted by: CADsortaGUY

Originally posted by: CPA

Originally posted by: senseamp
Because it has to be revenue neutral so it doesn't add to the deficit.

Here we go again. The AMT was not supposed to be applied against this low level of income. It is not adjust for inflation. So why is it necessary to be revenue neutral?

Why is it necessary? It isn't, but it's a good excuse(read "cover") for the dems to raise other taxes instead of lowering spending.

Did you even read the article? That would explain exactly why the AMT is not being voted on as a solitary issue. I'm so sick of people saying "why doesn't Congress vote on issues one thinga at at time?" Any basic lesson on civics will tell you exactly why they don't do that and why it would be catastrophic for our democracy if they did.

The Democrats want to finance the reduction in AMT revenue by taxes elsewhere. The Republicans just want to reduce it with no changes elsewhere. Ie. finance it with more and more debt which is incredibly fiscally irresponsible.

You might not like that the Democrats are choosing to raise other taxes other then reduce spending, but the Republicans are choosing to do neither.... just like they have been doing for the last 6 years. They are like kids with their parents' credit card. They don't seem to realize that someone has to pay for all those clothes someday.

 

[CPA]

Originally posted by: cliftonite

Originally posted by: CPA
Baucus rejected that plan but said it was a constructive beginning. Reid, accusing Republicans of stalling so Democrats would get blamed for failing to act on the AMT, moved to hold a vote, probably on Thursday, on cutting off debate and proceeding to the House bill.


bwahahahahaaha, cry me a river Reid, of course, it's the Dems fault. You're playing a shell game using the "revenue neutral" mantra instead of understanding the money from this abomination of a tax was never meant to collected in the first place. Hey, here's a thought, if you would control your spending you wouldn't even have to worry about being revenue neutral, now would ya?[

Hard to control spending when the command in chief requests tens of billions every now and then for his false war isnt it?

approved by the Dems.

 

[Pabster]

Originally posted by: CPA
approved by the Dems.

Take your pesky facts out of here.

 

[CPA]

Originally posted by: Craig234

Originally posted by: CPA

Originally posted by: Craig234
I think Senseamp nailed it.

Funny how only one side is 'playing politics'.

I'm not sure of the exact distribution of the AMT, but perhaps the dems feel it's better to leave it in place in the short term as it creep down too low, in the interest of slightly reducing the terrible Republican policy of hugely excessive borrowing instead of balancing the budget. I can't blame them a bit for that if it's the case since Republican block any fiscal responsibility.

But it would be good to see the AMT fixed, indexed to inflation, and the tax rates fixed as well, i.e., some of the cuts for the top below the levels needed for fiscal responsibility repealed.

25M taxpayers. That's the distribution. And yep, I'm one of them if this doesn't get fixed. And, no, I'm not rich, I'm not in the top 5% of all earners, believe me.

25M is not a distribution. What is the range of income of the 25M, how much more tax will they pay than if this were repealed, where does this 25M fit in to the total base?

Again, I'm in favor of fixing this, but I'm also interested in the large debt problem we have.

I can give you my numbers. For 2007 I will pay more than $5000 in additional tax if the AMT is not at least fixed to the 2006 levels. It basically increases my taxes 25%.

I know the $$$ effect is out there. I'll see if I can find it.

 

[piasabird]

How are the consumers going to reduce spending for a higher tax?

If Consumers (Taxpayers) can be expected to lower their spending, then the Government (Congress) can lower its spending.

I was not born yesterday.

 

[CADsortaGUY]

Originally posted by: eskimospy

Originally posted by: CADsortaGUY

Originally posted by: CPA

Originally posted by: senseamp
Because it has to be revenue neutral so it doesn't add to the deficit.

Here we go again. The AMT was not supposed to be applied against this low level of income. It is not adjust for inflation. So why is it necessary to be revenue neutral?

Why is it necessary? It isn't, but it's a good excuse(read "cover") for the dems to raise other taxes instead of lowering spending.

Did you even read the article? That would explain exactly why the AMT is not being voted on as a solitary issue. I'm so sick of people saying "why doesn't Congress vote on issues one thinga at at time?" Any basic lesson on civics will tell you exactly why they don't do that and why it would be catastrophic for our democracy if they did.

The Democrats want to finance the reduction in AMT revenue by taxes elsewhere. The Republicans just want to reduce it with no changes elsewhere. Ie. finance it with more and more debt which is incredibly fiscally irresponsible.

You might not like that the Democrats are choosing to raise other taxes other then reduce spending, but the Republicans are choosing to do neither.... just like they have been doing for the last 6 years. They are like kids with their parents' credit card. They don't seem to realize that someone has to pay for all those clothes someday.

And anyone with a lick of logic would tell you that if an issue is so important(which both sides agree on) then can and should be a 1 issue vote. Sheesh.

Oh, and BTW - you don't "finance" a cut in a tax. You "finance" spending.

 

[jonks]

Originally posted by: Pabster

Originally posted by: CPA
approved by the Dems.

Take your pesky facts out of here.

So the Congress controlled by Republicans from the war's start (2003) until the beginning of 2007 was "controlling" the president's spending, but the Dems in control for less than a year are the reason spending is high. Gotcha. Hate it when I mix my selective facts up.

 

[Genx87]

Originally posted by: cliftonite

Originally posted by: CPA
Baucus rejected that plan but said it was a constructive beginning. Reid, accusing Republicans of stalling so Democrats would get blamed for failing to act on the AMT, moved to hold a vote, probably on Thursday, on cutting off debate and proceeding to the House bill.


bwahahahahaaha, cry me a river Reid, of course, it's the Dems fault. You're playing a shell game using the "revenue neutral" mantra instead of understanding the money from this abomination of a tax was never meant to collected in the first place. Hey, here's a thought, if you would control your spending you wouldn't even have to worry about being revenue neutral, now would ya?[

Hard to control spending when the command in chief requests tens of billions every now and then for his false war isnt it?

Find a new excuse please.

 

[Fern]

Originally posted by: CPA

Originally posted by: senseamp
Because it has to be revenue neutral so it doesn't add to the deficit.

Here we go again. The AMT was not supposed to be applied against this low level of income. It is not adjust for inflation. So why is it necessary to be revenue neutral?

I'm not sure that the revenue neutral aspect is anything other than a false canard.

To be revenue neutral within itself it merely needs to be adjusted to bring in no more (or no less) revenue than it did last year. In 2006 4 million taxpayers were hit with AMT. This year it is expected to be 25 million.

There's plenty of room for cutting while remaining revenue neutral.

Fern

 

[shira]

Originally posted by: CPA

Originally posted by: Craig234

Originally posted by: CPA

Originally posted by: Craig234
I think Senseamp nailed it.

Funny how only one side is 'playing politics'.

I'm not sure of the exact distribution of the AMT, but perhaps the dems feel it's better to leave it in place in the short term as it creep down too low, in the interest of slightly reducing the terrible Republican policy of hugely excessive borrowing instead of balancing the budget. I can't blame them a bit for that if it's the case since Republican block any fiscal responsibility.

But it would be good to see the AMT fixed, indexed to inflation, and the tax rates fixed as well, i.e., some of the cuts for the top below the levels needed for fiscal responsibility repealed.

25M taxpayers. That's the distribution. And yep, I'm one of them if this doesn't get fixed. And, no, I'm not rich, I'm not in the top 5% of all earners, believe me.

25M is not a distribution. What is the range of income of the 25M, how much more tax will they pay than if this were repealed, where does this 25M fit in to the total base?

Again, I'm in favor of fixing this, but I'm also interested in the large debt problem we have.

I can give you my numbers. For 2007 I will pay more than $5000 in additional tax if the AMT is not at least fixed to the 2006 levels. It basically increases my taxes 25%.

I know the $$$ effect is out there. I'll see if I can find it.

What you've written doesn't jibe: If $5,000 represents a 25% increase in your federal tax, then that means your normal federal tax is $20,000. Assuming you're married filing jointly, that means a TAXABLE income of about $109,000. And you say "I'm not in the top 5% of earners." Hmm.

For your AMT to be $5000, that means the tax calculated on the 2006 AMT form (6251) was $25,000. At the 26% AMT rate, your AMT taxable income therefore was $96,000. That means a total AMT income of almost $160,000 (AMT exemption amount for married/filing jointly was $62,000 in 2006).

So you're household income is at least $160,000, which is already at the 95th percentile of U.S. household incomes. However, since AMT doesn't negate personal exemptions ($3400 a pop), that's another $7,000 (you and your wife, assuming no kids). And let's assume a middling home mortgage interest deduction of $12,000 (also deductible under AMT) - now you're at almost $177,000+. $200,000 is in the top 2.7% of U.S. household incomes, so I have a hard time believing the "not top 5% statement." And since you added "believe me," it sounds like you're not even close to the top 5%. Hmmm.

But maybe you're single, which would lower the number somewhat. Still, it's hard to reconcile the $5,000 = 25% and "not top 5%, believe me" statements.

Also, note that if AMT tax is assessed based on "AMT deferral items" (for example, company stock options that have been exercised), the extra tax you pay based on those deferral items can be credited in future years against the normal tax owed on those stocks. So you'll recoup some of the extra tax.

 

[fskimospy]

Originally posted by: CADsortaGUY

Originally posted by: eskimospy

Originally posted by: CADsortaGUY

Originally posted by: CPA

Originally posted by: senseamp
Because it has to be revenue neutral so it doesn't add to the deficit.

Here we go again. The AMT was not supposed to be applied against this low level of income. It is not adjust for inflation. So why is it necessary to be revenue neutral?

Why is it necessary? It isn't, but it's a good excuse(read "cover") for the dems to raise other taxes instead of lowering spending.

Did you even read the article? That would explain exactly why the AMT is not being voted on as a solitary issue. I'm so sick of people saying "why doesn't Congress vote on issues one thinga at at time?" Any basic lesson on civics will tell you exactly why they don't do that and why it would be catastrophic for our democracy if they did.

The Democrats want to finance the reduction in AMT revenue by taxes elsewhere. The Republicans just want to reduce it with no changes elsewhere. Ie. finance it with more and more debt which is incredibly fiscally irresponsible.

You might not like that the Democrats are choosing to raise other taxes other then reduce spending, but the Republicans are choosing to do neither.... just like they have been doing for the last 6 years. They are like kids with their parents' credit card. They don't seem to realize that someone has to pay for all those clothes someday.

And anyone with a lick of logic would tell you that if an issue is so important(which both sides agree on) then can and should be a 1 issue vote. Sheesh.

Oh, and BTW - you don't "finance" a cut in a tax. You "finance" spending.

No, you can finance either one. And anyone who knows anything about how government works knows exactly why you don't do one issue voting. It's an effective line item veto for the president, and destroys the balance of power between branches of govt.

 

[Fern]

Originally posted by: eskimospy
No, you can finance either one. And anyone who knows anything about how government works knows exactly why you don't do one issue voting. It's an effective line item veto for the president, and destroys the balance of power between branches of govt.

While I believe that you are theoretically correct, my belief on why we don't see many single issues is Congressional "horse trading" and a lack of trust in one another.

"I'll vote for yours if you vote for mine. And, btw, put 'em in the same bill so I can be sure I won't be double-crossed later..."

Fern

 

[fskimospy]

Originally posted by: Fern

Originally posted by: eskimospy
No, you can finance either one. And anyone who knows anything about how government works knows exactly why you don't do one issue voting. It's an effective line item veto for the president, and destroys the balance of power between branches of govt.

While I believe that you are theoretically correct, my belief on why we don't see many single issues is Congressional "horse trading" and a lack of trust in one another.

"I'll vote for yours if you vote for mine. And, btw, put 'em in the same bill so I can be sure I won't be double-crossed later..."

Fern

Well its both, but both are equally important. One is just the process of getting business done in government, and the other is a crucial limitation of executive power.

 

[CADsortaGUY]

Originally posted by: eskimospy

Originally posted by: CADsortaGUY

Originally posted by: eskimospy

Originally posted by: CADsortaGUY

Originally posted by: CPA

Originally posted by: senseamp
Because it has to be revenue neutral so it doesn't add to the deficit.

Here we go again. The AMT was not supposed to be applied against this low level of income. It is not adjust for inflation. So why is it necessary to be revenue neutral?

Why is it necessary? It isn't, but it's a good excuse(read "cover") for the dems to raise other taxes instead of lowering spending.

Did you even read the article? That would explain exactly why the AMT is not being voted on as a solitary issue. I'm so sick of people saying "why doesn't Congress vote on issues one thinga at at time?" Any basic lesson on civics will tell you exactly why they don't do that and why it would be catastrophic for our democracy if they did.

The Democrats want to finance the reduction in AMT revenue by taxes elsewhere. The Republicans just want to reduce it with no changes elsewhere. Ie. finance it with more and more debt which is incredibly fiscally irresponsible.

You might not like that the Democrats are choosing to raise other taxes other then reduce spending, but the Republicans are choosing to do neither.... just like they have been doing for the last 6 years. They are like kids with their parents' credit card. They don't seem to realize that someone has to pay for all those clothes someday.

And anyone with a lick of logic would tell you that if an issue is so important(which both sides agree on) then can and should be a 1 issue vote. Sheesh.

Oh, and BTW - you don't "finance" a cut in a tax. You "finance" spending.

No, you can finance either one. And anyone who knows anything about how government works knows exactly why you don't do one issue voting. It's an effective line item veto for the president, and destroys the balance of power between branches of govt.

No - cuts in taxes aren't a "cost" so they can not be financed. While there is truth to what you say about bills being grouped - it doesn't mean they must be, especially when both sides say they want to fix the issue and call it urgent.