It went down to the wire, but Congress finally provided some alternative minimum tax (AMT) relief.
Here’s the skinny: Your potential AMT liability is reduced by an exemption amount based on your filing status. Congress passed a new law raising the exemption amounts for 2007 tax returns:
- $66,250 for joint filers (up from $62,550)
- $44,350 for single filers (up from $42,500)
- $33,125 for marrieds filing separately (up from $31,275)
This is just a temporary fix for 2007. For 2008, the exemption amounts are scheduled to revert to 2001 levels unless Congress takes further action. Plus, the exemption amounts are reduced for certain high-income taxpayers.
And that’s not all: The changes came too late for the IRS to fully accommodate. This will likely delay refunds for some taxpayers and cause other complications.
- Small Business Tax Deduction Strategies No matches