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On a national basis, the impact of the
federal Alternative Minimum Tax (AMT) on American families has
been increasing over time and will accelerate in the near future.
We conclude that the AMT has a serious negative impact on California
that is disproportionate to states in general, and that this
negative impact is contributing to California’s deteriorated
economic condition.
Under current law, by 2010 the AMT will impact 97 percent of married couples with two or more children who earn between $75,000 and $100,000. This amounts to a surcharge, on average, of $3,750 that otherwise would not be paid. By 2010, the AMT will impact 73 percent of filers earning $75,000 to $100,000 and 36 percent of filers earning $50,000 to $70,000. |
The number of taxpayers with adjusted gross income (AGI) less than $50,000 owing AMT in 2001 is virtually the same as the number of taxpayers with AGI between $475,000 and $500,000 who owed no AMT. The tax that was created to ensure that 155 wealthy Americans paid their fair share of federal personal income taxes by targeting a handful of deductions is now the most complex tax code in the nation’s history and is unfairly targeting a growing percentage of middle-class American families. The AMT exemption amount is set to fall back to pre-2001 levels if Congress does not act to extend current provisions. If this occurs, the number of middle-class families impacted by the AMT will increase by tens of millions over 5 years. Back to Publications... |
