Alternative minimum tax and NJ: perfect together
Democratic leaders in Congress say that fixing the alternative minimum tax will be a priority this year - welcome news in light of the latest depressing tax news for New Jersey residents. The state ranks first in the number of federal income tax returns subject to the costly AMT.
The AMT was originally created to prevent the super-rich from exploiting tax loopholes to avoid paying the Internal Revenue Service their fair share - if anything at all. But because of rising incomes, and the lack of an inflation adjuster in the AMT legislation, more than 30 million people, including millions of middle-class families, are expected to be subject to the costly AMT by 2010 - nearly 20 percent of all filers.
In 2004, the latest year for which figures are available, 5.5 percent of New Jersey taxpayers were subject to the AMT. Among the nation's counties, Monmouth ranked 12th (8.2 percent of all filers). The average additional tax liability under the AMT in Monmouth was $3,805.
If you don't understand the AMT, or whether you could end up being snared in its web if you haven't been already, here's a primer: http://www.fairmark.com/amt/amt101.htm.
And here's a link to the Tax Foundation report: http://www.taxfoundation.org/publications/show/2131.html
The AMT was originally created to prevent the super-rich from exploiting tax loopholes to avoid paying the Internal Revenue Service their fair share - if anything at all. But because of rising incomes, and the lack of an inflation adjuster in the AMT legislation, more than 30 million people, including millions of middle-class families, are expected to be subject to the costly AMT by 2010 - nearly 20 percent of all filers.
In 2004, the latest year for which figures are available, 5.5 percent of New Jersey taxpayers were subject to the AMT. Among the nation's counties, Monmouth ranked 12th (8.2 percent of all filers). The average additional tax liability under the AMT in Monmouth was $3,805.
If you don't understand the AMT, or whether you could end up being snared in its web if you haven't been already, here's a primer: http://www.fairmark.com/amt/amt101.htm.
And here's a link to the Tax Foundation report: http://www.taxfoundation.org/publications/show/2131.html
posted by Randy Bergmann at 3:51 PM
2 Comments:
I'm glad to see were # 1, like Corzine said "Lets make history"
These geniuses who made up this AMT...couldn't they have forseen that this would unintentionally penalize the middle-class? They should have figured out different scenarios. It seems to be that they did not look into the long-term repercussions, and pushed it through. The FDA gets in trouble for doing stuff like that (look at Vioxx and Celebrex).
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