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Senate Passes One Year AMT Patch
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ShareDecember 06, 2007 8:11 PM
ABC News' Z. Byron Wolf and Jennifer Duck Report: After months of back and forth, the Senate voted Thursday to pass a one year patch to fix the Alternative Minimum Tax. The bill now makes its way to the House with White House support.
The Alternative Minimum Tax (or AMT) was meant to close a tax loophole for the wealthy, but because it was not pegged to inflation has ensnared millions more Americans each year, erasing their deductions.
The Senate version of the AMT fix passed 88-5 with Democratic Senator of Ohio Sherrod Brown in the chair.
The next big question -- will House Democrats accept this fix and will the IRS have enough time to print its tax forms before tax time. Both are unknowable at the moment.
Democrats had argued that passing tax relief without offsetting it with revenue gains someplace else was fiscally irresponsible. Republicans in the Senate blocked that version when a cloture vote this morning fell to a party line vote. Democrats needed 60 votes, but with so many Senators campaigning for President, did not get 50.
The version the Senate passed is more in line with what Republicans want. It grants the AMT fix without offsetting those revenue losses elsewhere.
The White House showed its support for the bill Thursday night. "We appreciate the U.S. Senate passing a clean, one-year patch of the Alternative Minimum Tax (AMT) this evening –as the President has called on them to do since February," White House press secretary Dana Perino said.
"If left unaddressed, the AMT would result in an unexpected, unfair tax increase for as many as 25 million Americans. This would mean that these taxpayers would have to pay, on average, an extra $2000 in higher taxes next year. We encourage the House of Representatives to swiftly pass this bill to stop this tax increase, and to prevent a costly delay in refunds."
December 6, 2007 in Romney, Mitt | Permalink | User Comments (1)
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has anyone noticed that tax rates for these so-called "middle class" folks (with very few exceptions the AMT kicks in at incomes more than double the US family median) have dropped substantially since the AMT was passed (77% marginal rate for $200k in the "good old days" to around 30% in today's AMT, depending on a number of factors), or that in general they don't pay social security taxes on the income that will be subject to the AMT?
Posted by: crc | Dec 6, 2007 10:19:54 PM
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