Posts Tagged ‘alternative minimum tax’

Democrats’ Alternative Minimum Tax (AMT): Because Whether They Have ‘Good Intentions’ Or Not, Theirs Truly IS The Road To Hell

February 10, 2012

Democrats cursed Americans with the AMT tax that has been a kick in the butt that has kept becoming a harder and harder kick in the butt every year since.

But keep in mind as we point a finger at the Democrat Party for taxing the bejesus out of middle class Americans with the AMT that it is only ONE of the many taxes Democrats are hiking on us.  From the article:

There are plenty of other tax issues to worry about for 2012.

Says Weltman, “More than 50 different tax breaks expired at the end of 2011. Unless those are extended, many people will be adversely affected.” As one example, she cites the tax break that applied to people filing in states without an income tax: Last year they could deduct local sales tax in lieu of state income tax.

This year they can’t—unless the break is restored. “They’ll be hit hard,” she warns.

Democrats are the party that hits decent people HARD.

Income Taxes: 30 Million May Be Hit by AMT This Year
By ALAN FARNHAM | Good Morning America – Wed, Feb 8, 2012 12:07 PM EST

Get ready to start paying higher taxes—$3,900 to $8,000 more a year on average. Unless Congress acts, some 30 million Americans will have to pay the dreaded Alternative Minimum Tax (AMT), whose rates, depending on your income, are either 26 percent or 28 percent.

According to the Congressional Budget Office, “Nearly every married taxpayer with income between $100,000 and $500,000 will owe some alternative tax.”

Like many awful things, the AMT is the result of good intentions.

It was created by Congress in the 1960s to help ensure that even the most tax-savvy rich paid some minimum amount. Congress, however, did not index its definition of “rich” to inflation. The result is that an income that qualified you as rich 30 years ago subjects you to the AMT—or would, if Congress didn’t authorize, every year, a “patch”—a specified amount of money a filer can deduct from his adjusted gross to stay below the AMT’s threshold.

If Congress failed to approve a new patch, the permissible amount for married couples filing jointly would fall, for example, from the current $74,450 to $45,000. “A lot more people would start paying a lot more money,” says Andrew Schwartz, founder of Schwartz & Schwartz, P.C., a CPA firm specializing in the tax and financial planning issues applicable to young professionals.

Right now uncertainty over when and whether Congress will approve a new patch makes tax planning difficult, he says. “For seven or eight years now,” he explains, “Congress has been passing these one or two-year patches, rather than make a more permanent fix.” According to him, tax planning software now in use assumes the worst: That Congress won’t act.

If no new patch were approved, says Barbara Weltman, a tax and business attorney and author of J.K. Lasser’s Tax Deduction for Small Business, 20 million to 30 million taxpayers not previously subject to the AMT would have to pay it.

The likelihood that you’ll be hit, says Schwartz, increases if you:

Have a large family

Have high real estate taxes and/or high state and local income taxes

-Claim significant miscellaneous itemized deductions

-Exercise and hold incentive stock options

-Realize significant long-term capital gains

Figuring out if the AMT applies to you isn’t easy. You start by going to the IRS’ website and using the “AMT Assistant,” a tool that will determine if you must file Form 6251, an AMT worksheet.

Persons who fail to make the effort (or who misjudge their eligibility) will have to pay not just the higher tax but penalties and interest as well.

You can reduce AMT exposure by reducing your adjusted gross income. For example, you can increase the contributions you make to your 401(k) or IRA. The self-employed can claim a home office deduction. Persons with substantial portfolio can move money from taxable investments into tax-exempt bonds or bond funds.

“With the AMT,” says Schwartz, “It’s all about timing.” Try to pay, for example, your real estate and state and local income taxes in years where your income falls outside AMT range, he advises.

There are plenty of other tax issues to worry about for 2012.

Says Weltman, “More than 50 different tax breaks expired at the end of 2011. Unless those are extended, many people will be adversely affected.” As one example, she cites the tax break that applied to people filing in states without an income tax: Last year they could deduct local sales tax in lieu of state income tax.

This year they can’t—unless the break is restored. “They’ll be hit hard,” she warns.

Heritage released the fact that Democrats seize $2.3 trillion from the MAKERS who create jobs and invest in our economy and then they “redistribute” $2.5 trilion it to the TAKERS in exchange for voting Democrat.

The top 10 percent of American “makers” pay 46% of all federal income taxes – a greater burden than ANYWHERE else on earth.  But they aren’t paying their “fair share” because Democrats are Marxists.

Obama and Democrats say that they haven’t raised taxes on the middle class.  But Obama and the Democrats are also proven liars.

We’re all of us getting taxed up to our necks due to Democrats’ taxes – whether those taxes are publicly demagogued (“make the rick pay their ‘fair’ share“) or are hidden:

Time to Tackle the Hidden Tax of Regulation
by Human Events
05/10/2011

Republicans are hitting President Obama on his idiotic call for tax hikes as well as his avaricious appetite for increased government spending, as they should.  But here’s a new target for them: The hidden tax of regulation.

A new report from the Competitive Enterprise Institute (CEI) titled “Ten Thousand Commandments” reveals the vast amount of private-sector capital drowned in the sea of government regulations.

The report’s conclusion is mind-boggling.  The cost of complying with federal regulations has hit the $1.7 trillion dollar mark.

That’s trillion, with a T.

To put that number in perspective, it’s larger than the President’s own anticipated 2011 budget deficit of $1.6 trillion.  In fact, the current regulatory burden imposed on businesses across America now amounts to 50% of total government spending in one year alone.

That’s nuts!

But guess what?  We can top it.

As the CEI report underscores, the compliance cost of regulation is larger than all corporate pretax profits in 2008 and dwarfs the estimated 2010 individual income tax receipts by nearly 50%.

That last point is worth repeating:  The cost of abiding by all the government regulations tallies up to $1.7 trillion, which towers over the revenue brought in by all income taxes, in every bracket.

We can also add that the compliance costs amount to more than $8,000 per American employee, but we’ll have to stop the comparisons there or else this editorial would rival Atlas Shrugged? in length—but with statistics.  Yikes!

So every time you hear some Democrat bemoan the ill-informed view that America is an underregulated society, tell them to put the above numbers in a pipe and smoke them.

Seriously.  America is hamstrung by onerous regulation.  That anyone can say otherwise defies belief.  CEI notes that the Federal Register, which spells out all the government’s proposed and confirmed regulations, runs practically 25,000 pages—an increase of 26% over the last decade.

And thousands more rules are being proposed each year.

A true “stimulus” to the economy would be to relax much of these regulations and allow entrepreneurs and business owners to spend their capital on expansion and product innovation, rather than conforming to the obligations of some bureaucratic scheme.  That’s not to say scrap all federal oversight, but the way things operate now, agencies are encouraged to brainstorm new policies without taking into account how they would negatively impact the economy.

I’ve asked the question: “If Raising Taxes Would Get America Out Of Trouble, WHY IS THE EURO ZONE IN SUCH DEEP SH!T???

I’ve asked the question: “Hey Democrats, Why Is It That States With The Highest Tax Rates Have The Highest Debt???

And seriously, why is it???

Greece is on the verge of complete collapse because it basically pursued the exact same policies that American Democrats have demanded.

We have one last chance to take a different path than “the road to hell.”