Alternative Minimum Tax Relief
On September 24, 2008, the House passed H.R. 7005 to provide critical tax relief to 25 million middle-class families by protecting them from the Alternative Minimum Tax.
The bill will provide $62 billion in Alternative Minimum Tax (AMT) relief to ease the strain of rising gas and food prices, and is a critical part of our plan to strengthen the American economy.
The AMT was put into place to ensure that the wealthiest families did not escape paying taxes altogether. It has grown to be such a problem that it now threatens teachers and firefighters – a far cry from its original intent.
Since taking control of Congress, Democrats have fought for fiscal responsibility and this summer the House passed legislation to provide millions of middle-class families with tax cuts without increasing the national debt. That middle-class tax relief was fully paid for -- adhering to strict pay-as-you-go budget discipline to ensure long-term American economic growth.
But the stubborn fiscal irresponsibility of Senate Republicans and President Bush has been a huge roadblock to a new direction of fiscal responsibility. On June 24, President Bush threatened to veto AMT relief that was paid for, and on Tuesday Senate Republicans rubberstamped that position voting against paying for an AMT bill, objecting to making oil companies pay their fair share for oil in the Gulf of Mexico and closing a tax loophole regarding CEO-deferred compensation paid by offshore companies.
So to protect middle-income families from this tax increase, we have been forced to drop offsets closing some tax loopholes; we simply cannot hold millions of middle-class families hostage due to misplaced Republican priorities.
Seven years of Republican policies have resulted in nearly $10 trillion of national debt. They have passed debt instead of prosperity onto our children and grandchildren. This has been bad for the economy: weakening the value of the dollar, raising the cost of oil and food for American families and businesses, and limiting our ability to meet the huge economic challenges we are facing today.
Cut Taxes for Millions of Families
Protects more than 25 million middle-class families from being hit by the AMT. The bill would extend for one year AMT relief for nonrefundable personal credits and increases the AMT exemption amount to $69,950 for joint filers and $46,200 for individuals.
Includes relief for AMT taxpayers who have exercised incentive stock options. In the past, taxpayers that exercised incentive stock options were unintentionally required by the AMT to pay tax on gains that never materialized. This provision will protect these taxpayers from this unintended tax.