Alternative Minimum Tax (AMT)
Last Updated Apr 15, 2009 3:14 PM EDT
Can I escape the AMT?
You might be able to avoid owing the dreaded alternative minimum tax (AMT) – depending on your income, your capital gains, and a handful of other factors. But if you have a gross income of $75,000 or more and a significant capital gain or stock options, or a home equity loan interest, there's a pretty good chance you'll be one of the several million Americans who must pay the AMT, a kind of parallel universe of federal taxes that requires extra, complicated calculations.
The AMT was originally created in 1969 to ensure that wealthy taxpayers wouldn't game the system to get out of paying their fair share of taxes. The income levels that trigger the AMT were not indexed for inflation, however. As a result, increasing numbers of middle-income Americans have found themselves owing this tax.
Each year Congress debates how to fix the AMT to avoid this bracket creep, typically enacting a one-year fix (if it does anything at all). The legislators came up with a patch in 2008 for '08 taxes and then again in the 2009 Stimulus law, for '09 returns.
The following links will help you to understand the AMT, determine whether you're likely to get socked by it, and figure out what to do if you must pay this
Avoid AMT Penalties from the IRS
Missing the AMT can bring the IRS to your door, but keeping tabs on these common filing pitfalls will keep you out of trouble.
The AMT and Your 2008 Taxes
All you need to know about whether you may owe the Alternative Minimum Tax for your 2008 taxes. Plus: how to calculate the tax on Form 6251.
IRS Calculator for 2008 AMT
The Internal Revenue Service's online AMT Assistant is an electronic version of its AMT worksheet in the Form 1040 instructions. Use this calculator to find out your AMT amount for your 2008 taxes.
Where to Get Help Calculating the AMT
A guide to free online assistance in calculating the Alternative Minimum Tax for your 2008 tax return. Plus: a link to Form 6251, the IRS's tax form for the AMT.
The AMT and Your 2009 Taxes
The 2009 Stimulus Law created a one-year patch for the Alternative Minimum Tax. So millions of people who would've owed the AMT for their '09 taxes now won't. See if the new law will help you.
Answers to Your AMT Questions
A quickie guide to everything you need to know about the Alternative Minimum Tax. Who owes it, how to avoid it, how to plan for your 2009 taxes and the AMT.Source: www.cbsnews.com