Hearings Begin on Alternative Minimum Tax

NEW YORK -- At a hearing Monday of the Finance Committee panel on taxation, senators noted that because the alternative minimum tax (AMT) has not been indexed for inflation, it is now affecting increasing numbers of middle-income taxpayers, Bloomberg News reported.

The minimum tax affects 3.5 million taxpayers today and by 2010 will force almost 32 million Americans, many with incomes of less than $100,000, to pay higher taxes, senators said.

“If I was given the opportunity to make just one change to the internal revenue code I would use it to eliminate the individual AMT,'' Nina Olson, national taxpayer advocate of the Internal Revenue Service, said at the hearing.

Repealing the tax would cost the government about $600 billion in lost revenue over 10 years, according to the non-partisan Tax Policy Center in Washington. The repeal may face opposition if it adds to a federal deficit that was a record $412 billion last year. The last Bush administration forecast said it will rise to $427 billion in the current fiscal year.

-- NYSSCPA.org News Staff

Posted on 5/24/05