In 1969 Congress created the Alternative Minimum Tax (AMT) after discovering that 155 wealthy taxpayers making over $200,000 had paid absolutely no taxes. In the days of bellbottoms and moon landings, the AMT made sure that those receiving a significant paycheck wouldn’t be able to avoid paying taxes altogether. But for the iPod generation, what was once a “class tax� has morphed into a “mass tax.� The AMT was never designed for working families trying to pay the mortgage, fill up the gas tank, and still save for college, but those are the folks it’s striking today.

We owe it to these families to put the brakes on the AMT, and I’m working with my colleagues to make sure not a single additional American family pays the tax this year. I asked the Joint Committee on Taxation to determine exemption limits for a “hold harmlessâ€? AMT provision that will protect hundreds of thousands of taxpayers who are currently vulnerable to this “stealth tax.â€? Now that those exemptions have been identified, I’m working closely with the IRS to make sure there’s a sensible timeframe for printing accurate forms and notifying taxpayers — see my letter to the IRS, with details, here.

We need to act and we will act soon. The House is marking up an AMT bill this week, and the Senate will act shortly thereafter. I’ve said since the first day of the 110th Congress that if I had my druthers, we’d be rid of the AMT altogether. Until that’s possible, I’ll work to protect more families from paying the outdated AMT.

Sen. Baucus is Chairman of the Senate Finance Committee.

This entry was posted on Thursday, November 1st, 2007 at 10:38 am and is filed under Politics, Economy/Budget .