The Individual Alternative Minimum Tax (AMT): 12 Facts and Projections

Publication Date: July 2008

Publisher: Tax Policy Center

Author(s): Leonard E. Burman; Julianna Koch; Greg Leiserson; Jeff Rohaly

Research Area: Banking and finance

Keywords: Economy; Federal Budgets & Fiscal Policy; Tax Reform; Simplification and Administration

Type: Report


Congress originally enacted a minimum tax in 1969 to guarantee that high-income individuals paid at least a minimal amount of tax. Under today?s alternative minimum tax (AMT), middle- and upper-income taxpayers must add a number of "preference items" to their taxable income, subtract a special AMT exemption, and calculate their tax according to the AMT rules. If the tax under those rules turns out to be higher than their regular income tax, taxpayers pay the difference as AMT. Unless Congress acts, 26.8 million taxpayers will be affected by the AMT in 2008.