The Alternative Minimum Tax...

**KrazyHorse** · February 2, 2012, 07:28

just cost me 12000 dollars. Awesome.

**Lorizael** · February 2, 2012, 08:35

I'm getting a $1500 tax return because about $7000 of my annual salary is a "Health & Welfare Allowance" that is apparently not part of my taxable income.

**dannubis** · February 2, 2012, 08:39

Originally Posted by KrazyHorse

just cost me 12000 dollars. Awesome.

More or in total ?

**gribbler** · February 2, 2012, 09:16

Awesome, annoying douchebags on wall street losing money

**Ogie Oglethorpe** · February 2, 2012, 09:22

Originally Posted by KrazyHorse

just cost me 12000 dollars. Awesome.

Welcome to the wonderful world of AMT.

**The Mad Monk** · February 2, 2012, 09:24

...a world brought into being the last time we decided the rich weren't paying enough.

**KrazyHorse** · February 2, 2012, 09:24

Originally Posted by dannubis

More or in total ?

More.

**The Mad Monk** · February 2, 2012, 09:25

Originally Posted by gribbler

Awesome, annoying douchebags on wall street losing money

Spoken like someone who never had to go through it.

**gribbler** · February 2, 2012, 09:50

Originally Posted by The Mad Monk

Spoken like someone who never had to go through it.

It must be hard being separated from all that money! If only more people knew what that was like

**The Mad Monk** · February 2, 2012, 09:57

Oh, they already do...

REMEMBER BACK when you were young and poor and nothing made you madder than tales of rich people who paid nothing in income taxes? Well, you weren't alone, and that anger led to the creation of something called the alternative minimum tax, which was designed to keep the rich from living tax-free.

Fast-forward a few years. You're a bit older, somewhat better off and paying far more in taxes than you ever thought possible. So what's the last thing you expect to see when you fill out your tax return? That you owe the alternative minimum tax. You can take some solace in the fact that thousands of taxpayers just like you have been snagged by this nasty bit of tax law in recent years. While only 19,000 people owed the AMT in 1970, millions are paying it now.

What happened? Inflation, mostly. While the "regular" tax brackets, exemptions and standard deductions are adjusted annually for inflation, the AMT brackets and exemptions are not, so many people whose income has grown with the economy enter the dreaded AMT zone each year. Especially vulnerable are people with income over $75,000 and some large deductions, but not the exotic ones that were originally targeted by the AMT's creators. Most vulnerable are taxpayers with several children, interest deductions from second mortgages, capital gains, high state and local taxes, and incentive stock options.

http://www.smartmoney.com/taxes/inco...imum-tax-9540/

...but don't worry, I'm sure you'll never make enough to be targeted.

**pchang** · February 2, 2012, 10:07

Count yourself lucky. Last year I got boned for an extra 15500. I'm still waiting on all my reporting forms to show up, but I expect it will be worse this year.

**KrazyHorse** · February 2, 2012, 10:24

I don't own a home so my deductions are essentially limited to state and local taxes. More deductions leads to lower 1040 taxes but higher AMT (they essentially offset).

**PLATO** · February 2, 2012, 10:29

The AMT is evil incarnate.

We need a simple, open, and fair tax policy. What we have now is a joke.

**dannubis** · February 2, 2012, 10:31

Originally Posted by KrazyHorse

More.

Auch !

**Herman Cain** · February 2, 2012, 10:49

Nine nine nine

Me for president!

**Al B. Sure!** · February 2, 2012, 13:27

I made less income last year than the excess KH has to pay due to AMT. Interdasting.

**Barnabas** · February 2, 2012, 14:19

Would you have had to pay for it if it had been adjusted to the inflation rate? It is crazy to keep a tax unchanged since the 70s

**Dinner** · February 2, 2012, 14:51

Originally Posted by KrazyHorse

just cost me 12000 dollars. Awesome.

I still qualify for the 26% AMT, I bet you have to pay the the 28% "high" bracket.

**regexcellent** · February 2, 2012, 14:55

Niener niener I make less money so don't have to pay as high taxes as you.

**gribbler** · February 2, 2012, 15:51

Originally Posted by Al B. Sure!

I made less income last year than the excess KH has to pay due to AMT. Interdasting.

Why is it interesting that you have no money?

**The Mad Monk** · February 2, 2012, 16:10

Not interesting, interdasting. Pay attanshun!

**KrazyHorse** · February 5, 2012, 16:28

Other interesting facts:

1) My marginal tax rate is 52.9%
2) My marriage penalty is 4.7% of my AGI (if we had lived together, each earned the same amount of money as we did, but simply not have been married, then we would have 4.7% more of our AGI after taxes)

a) at a marginal tax rate of 52.9%, what is the likelihood that the US will lose the labor of a productive medical physicist when we have a child?
b) given the penalty of 4.7% of AGI, I am now seriously considering getting divorced for tax purposes. Is this some kind of perverse social engineering?

**Dinner** · February 5, 2012, 16:31

What was your average tax rate after deductions? No one cares about marginal rates.

**KrazyHorse** · February 5, 2012, 16:41

You're a ****ing moron. Marginal rates are where the incentive to produce more comes from.

Leave it to a mindless ****ing lefty partisan like yourself to claim that "nobody cares about marginal rates". I guess that's consistent with the apparent view that incentives don't matter.

My effective tax rate is between 35 and 36%, using my medicare wage base (which includes 401k contributions, unlike AGI) as the denominator and including my half of FICA taxes in the numerator.

**DaShi** · February 5, 2012, 16:45

Seems fine to me.

**Dinner** · February 5, 2012, 16:46

Marginal tax rates are a big meh. Effective/average tax rates are far more important especially since the tax code has a million and one ways to lower your marginal rate so stop whining.

**KrazyHorse** · February 5, 2012, 16:49

a) I have no problem with paying 35% of my earnings in taxes.
b) I have a problem with most of the US (including the middle class, broadly defined) paying very little in taxes, leading to enormous budget deficits
c) I have a problem with an idiotic tax system that can't manage to collect 35% without applying marginal rates of 53%. So should you, because I'm very serious about the chances of this leading to the withdrawal from the labor force of my wife.
d) I have a problem with the government sticking its nose into my marriage and encouraging me to get divorced

**KrazyHorse** · February 5, 2012, 16:50

Originally Posted by Dinner

Marginal tax rates are a big meh. Effective/average tax rates are far more important especially since the tax code has a million and one ways to lower your marginal rate so stop whining.

I'm not sure you even know what the terms you're using mean, you ****ing idiot.

**Dinner** · February 5, 2012, 16:52

Get some more deductions; my suggestion is to buy a house and have the wife pop out a few ankle biters. Then you can take advantage of that morgage interest deduction you hate so much.