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The Individual Alternative Minimum Tax: Historical Data and Projections, Updated October 2009
Publication Date: October 2009
Publisher(s): Tax Policy Center
Author(s): Katherine Lim; Jeff Rohaly
Special Collection: John D. and Catherine T. MacArthur Foundation
Topic: Banking and finance (Taxation and tax policy)
Keywords: Fiscal future; Tax Distribution and Economic Trends; Taxes, the Budget, and the Economy; Taxation of Households
Type: Paper
Abstract:
The alternative minimum tax (AMT), which originally targeted high-income taxpayers, requires annual legislation to prevent it from affecting millions of middle-income individuals each year. There are two primary reasons for the AMT?s broadening impact; its parameters are not indexed for inflation and the 2001-2006 tax cuts reduced regular tax liability without changing AMT liability. In 2009, four million taxpayers will pay $33.5 billion in AMT, but without congressional action that number will rise to 27 million owing $102 billion in 2010. This paper describes the AMT and provides TPC?s latest estimates of AMT coverage, revenue, and distribution.