AMT repeal. Lower corporate tax rates.

[Allthingznew]

We'll see.

http://money.cnn.com/2007/10/25/pf/taxes/rangel_tax_reform/index.htm?section=money_topstories

"Leading Republicans - including House Ways and Means Ranking Member Jim McCrery (R-La.) and Senate Finance Committee Ranking Member Charles Grassley (R-Iowa) - argue that AMT repeal is the right thing to do to protect middle-income Americans from a tax they were never intended to pay, so there's no need to compensate for the cost because it was revenue that never should have been collected in the first place.

Lawmakers on both sides of the aisle and those in between have known for years that the AMT would start to affect middle- and upper-middle-income taxpayers barring any permanent changes to the law, but they nevertheless left it on the books. That means every federal budget projection has factored in the amount of revenue the AMT would raise once it starts hitting non-wealthy taxpayers, and spending commitments were made based on those projections."

 

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[Diane Kennedy]

Just thought I'd post on this thread - nothing has happened on AMT this year.

As it stands right now, an estimated 27 million Americans will be subject to AMT this year. You can't deduct home equity loans (in most cases), can't deduct state and local taxes, can't deduct medical expenses (in most cases)....the list of things you can't deduct goes on and on. For real estate investors, you can't take ANY real estate losses against your other income and you can't accelerate your depreciation. If you have LT capital gains, you don't get the 15% preferential rate. Tax-free bond income isn't tax-free anymore (in some cases).

Everything is different under AMT.

If Congress does come back and come up with a bill that the Senate will approve and the Pres signs, then the IRS has said that they will immediately halt their tax season to reprogram their computers. That will take 12 - 15 weeks...which means refunds won't start coming out of the IRS until April or May.

This will be a very interesting tax year.

 

[andviv]

I just read this article about the IRS issues with any changes from congress. AMT is the topic here:

The IRS and the oversight board anticipate that if the filing season were delayed until Jan. 28, it would hold up the processing of 7 million tax returns and $17 billion in refunds. If the season begins Feb. 18, it would postpone the processing of 38 million returns and $87 billion in refunds, based on 2007 IRS data.

The consequences of a delay may also lead taxpayers who have been filing electronically to revert to paper filing. The IRS can shut down its systems for accepting electronic returns, but it cannot prevent taxpayers from mailing paper returns, even if they cannot be processed right away. More paper filing will increase the IRS’ costs for processing and boost the probability of error by the taxpayer and the agency, the board said in the report.

 

[Megan H]

Re: AMT Update 12-5-07

Hi,

Here's the text of a news release that hit my inbox this morning. I gave Diane a head's up and she has (or will be) posting more in her blog about it.

Now is it just me, or does "invoking cloture" sound more like he's doing something with clotted cream and tea biscuits?

Megan :seeya:

Swift Passage of AMT Stalled by Objections; Reid Moves to Hold Roll Call Vote

Senate Republicans on December 4 objected to a unanimous consent request to approve alternative minimum tax (AMT) legislation, and Senate Majority Leader Harry Reid, D-Nev., immediately moved to invoke cloture on a motion to proceed to the House-passed AMT bill (HR 3996). Senate Finance Committee Chairman Max Baucus, D-Mont., is preparing to offer an amendment with one year of AMT relief and two years of extensions for expiring tax provisions, with the extender provisions fully offset. He lodged an objection on behalf of the majority to a proposal that would have introduced additional tax measures into the AMT debate. Senate Republicans have repeatedly stated that both the AMT patch and extenders legislation should not be offset, as that would require increasing taxes in other areas.


"We must act now," said Baucus in a floor statement. "We've already missed one deadline. The IRS sent the 2007 tax forms to the printer on November 16." The senior tax writer told members that Congress will need to address major tax reform in 2009, but Congress should begin working on hearings, debate, and new ideas for that effort now. "And the sooner that we address expiring provisions, the sooner that we can turn to tax reform," added Baucus.


Reid also lashed out at Senate Republicans, charging that they were "slow-walking this important bill even as they complain it is not getting done." The majority leader vowed that the Senate would work to resolve the issue. The House measure includes revenue offsets for both the AMT patch and tax extenders, and would most certainly fail to move in the Senate. If the Senate approves the Baucus amendment, the House would then need to reconsider its original bill, the Temporary Tax Relief Bill of 2007, before President Bush could sign the legislation into law

 

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