Congress passes AMT patch

[FIRE'd@51]

Quote:

Originally Posted by myself Well, all I can suggest is to get some deductions. Or of course lower your income. We paid only 2.49% in taxes last year due to deductions. Of course, I wouldn't suggest everyone get a short term mortgage (12.5 years left on a 15 year mtg) or have 4 kids either.

BTW, four kids won't help if you get trapped by the AMT, since personal exemptions are not allowed there.

[myself]

Quote:

Originally Posted by FIRE'd@51 BTW, four kids won't help if you get trapped by the AMT, since personal exemptions are not allowed there.

Yes, I know.
My goal is to get back to the point where we use the standard deduction, although I believe anyone can opt for that. Some (like me) choose to go the route that gives us more taxes back while they can.
And if all things progress as they have been (raising the standard deduction and mortgage interest we pay going down), we'll be back to the standard deduction in the next 4-6 years.
(Truth be told that we'll just be hitting the 6 figure income mark this year)

[myself]

Quote:

Originally Posted by audreyh1 If AMT had been indexed to inflation, it would have kept the same limited scope it had when it was first created. Audrey

Also, if you calculate how much people actually pay, it is usually quite a bit less than what their tax bracket is (after all, this is a progressive tax system).
For AMT purposes, if you're MFJ and income is below $150k, you won't be suceptible to the AMT. And single is $112,500 income.
Keep in mind I live in the highest property tax state in the US (NJ) according to most financial magazines.

Here's the AMT form in case anyone needs it: http://www.irs.gov/pub/irs-pdf/f6251.pdf

[jIMOh]

Quote:

Originally Posted by Caoineag Yeeeck, I think I need to look up info on the AMT, I had no idea we had been skirting just under...

Just because you make X amount doesn't immediately trigger AMT. My understanding is AMT is triggered more by the deductions you take than it is by the income you make.

[FIRE'd@51]

Quote:

Originally Posted by myself For AMT purposes, if you're MFJ and income is below $150k, you won't be suceptible to the AMT. And single is $112,500 income.

Not necessarily true. If your state and local taxes (income and property) are high, you may be, even with AGI below 150k.

[audreyh1]

Quote:

Originally Posted by jIMOh Just because you make X amount doesn't immediately trigger AMT. My understanding is AMT is triggered more by the deductions you take than it is by the income you make.

It also depends on how much of your income is capital gains. A large cap gains portion easily triggers AMT on your ordinary income. Unfair, but there it is!

Audrey