Alternative Minimum Tax - AMT

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Dictionary Says

Definition of 'Alternative Minimum Tax - AMT'

A tax calculation that adds certain tax preference items back into adjusted gross income. Alternative minimum tax (AMT) uses a separate set of rules to calculate taxable income after allowed deductions. Preferential deductions are added back, and then the AMT exemption is subtracted to get the AMT taxable income (AMTI). AMTI is then taxed at the current rate schedule to get tentative minimum tax (TMT). If TMT is higher than the regular tax liability for the year, the regular tax and the amount by which the TMT exceeds the regular tax are paid (i.e. the taxpayer pays the full TMT).
Investopedia Says

Investopedia explains 'Alternative Minimum Tax - AMT'

AMT is designed to prevent taxpayers from escaping their fair share of tax liability through certain tax breaks, although the structure is rife with controversy as it is not indexed to inflation or tax cuts. This causes a condition known as "bracket creep", whereby upper-middle-income taxpayers are becoming subject to this tax. In 2006, the IRS National Taxpayer Advocate reported that the AMT often punishes taxpayers for having children or living in high-tax states.
Search results for

'Alternative Minimum Tax (AMT)'

  • How To Cut Your Alternative Minimum Tax

    http://www.investopedia.com/articles/pf/07/amtbasics.asp
    ... Then you calculate your taxes using the rules for the alternative minimum
    tax (AMT), which eliminates some tax deductions and credits. ...

  • End-Of-The-Year Income Tax Checklist - Investopedia.com

    http://financialedge.investopedia.com/financial-edge/1211/End-Of-The-Year-Income-Tax-Checklist.aspx
    ... to shift expenses from January to December to get the tax deduction a year earlier
    can backfire if you end up being subject to the alternative minimum tax (AMT) ...

  • Cut Employee Stock Option Taxes With AMT Credit

    http://www.investopedia.com/articles/tax/09/refundable-AMT-credit.asp
    ... Under ยป Taxes. If you exercised incentive stock options (ISO) in the last several
    years, you may have been hit with a hefty alternative minimum tax (AMT) bill. ...

  • Avoid Tricky Tax Issues On Municipal Bonds

    http://www.investopedia.com/articles/06/munibond.asp
    ... The Alternative Minimum Tax Although it is relatively uncommon, some muni bonds
    are federally taxed if the holder is subject to alternative minimum tax (AMT). ...

  • Series 7 Study Guide - Municipal Securities - Muni Taxes ...

    http://www.investopedia.com/exam-guide/series-7/municipal-securities/muni-tax.asp
    ... There are a couple of exceptions to this rule: Alternative Minimum Tax (AMT) AMT
    was designed in the late 1960s to confront the perception that the rich do not ...

  • Inaccurate Tax Return, Now What?

    http://www.investopedia.com/articles/pf/09/inaccurate-tax-return.asp
    ... Not filing a return when a refund is due; Not checking liability for the alternative
    minimum tax (AMT) (To learn more, read Cut Your Alternative Minimum Tax.). ...

  • The Basics Of Municipal Bonds

    http://www.investopedia.com/articles/bonds/05/022805.asp
    ... Investors subject to the alternative minimum tax (AMT) must include interest income
    from certain munis when calculating the tax, and should consult a tax ...

  • The History Of Taxes In The US

    http://www.investopedia.com/articles/tax/10/history-taxes.asp
    ... The alternative minimum tax (AMT), a type of federal income tax, wasn't
    enacted until 1978. This parallel system uses a separate ...

  • It Is Better To Give AND Receive

    http://www.investopedia.com/articles/pf/07/give_and_receive.asp
    ... Maximum/Minimum Limit(ed) Hassle: Do you want to donate more but face an alternative
    minimum tax (AMT) hit, an unneeded mandatory required minimum distribution ...

  • Reporting Your Interest Income

    http://www.investopedia.com/articles/tax/10/interest-income.asp
    ... These are taxable at the federal level only; municipal bond interest is exempt from
    taxation of any kind, unless the alternative minimum tax (AMT) applies. ...

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