Washington -- The groundswell calling for revamping the Alternative Minimum Tax has wafted over to the American Bar Association as its tax section has drafted a report to lawmakers requesting that the 35-year-old measure be either repealed or modified.
Last week, a report from the American Bar Association Section of Taxation to both the House Ways and Means Committee and the Senate Finance Committee said the controversial tax has morphed into big headache for middle class taxpayers.
The ABA said that since passage of the AMT, lawmakers have not indexed it for inflation, while adding a number of adjustments. Subsequently, the group has called for the tax to be either repealed or modified in order fulfill its original mission of applying to taxpayers in higher-income brackets.
The AMT was passed in an effort to prevent those with very high incomes from using special tax benefits to pay little or no tax. However, the AMT has affected more taxpayers each year, including those in the middle-income brackets without many special tax benefits. According to the Internal Revenue Service, just 19,000 people owed the AMT in 1970, while roughly 2.6 million are currently paying it.
