10/06/2010

23 Million Americans Hit by a Tax Hike, But They May Not Know It Yet

AMT Threatens To Hit Middle Class Unless Congress Acts
Tuesday, October 05, 2010

By Dan Joseph

(CNSNews.com) - Almost 23 million American households are about to have their federal taxes raised by an average of $3,900 this year, but they may not know it yet.


They could get a big surprise when they prepare their tax returns next year.

Among those subject to this already-in-place tax increase are some families making less than $50,000 per year, and virtually all married couples earning between $100,000 and $500,000 a year, according to data published by the Congressional Budget Office.

The looming tax hike is contrary to President Barack Obama's repeated promise not to increase taxes on any individual earning less than $200,000 a year or on any household earning less than $250,000.


This tax increase on almost 23 million people will happen if Congress does not quickly pass legislation that temporarily increases the amount of income exempt from the Alternative Minimum Tax.

The temporary reprieve passed by Congress for each of the past nine years expired on Dec. 31, 2009, and so far, Congress has not extended the AMT "fix" for 2010.

According to the CBO, an estimated 4.5 million American households were subject to the AMT in 2009, and 27.2 million are now liable to pay the AMT for the 2010 tax year unless Congress acts before Dec. 31. Under current law, at least 22.7 million American households that did not have to pay the AMT last year will have to pay it on the income they have been earning since Jan. 1 of this year.

Repealing the AMT completely and permanently would add $626 billion to the federal debt over the next ten years, according to CBO.

Read More Here


Enhanced by Zemanta
There was an error in this gadget