The Senate Finance Committee has proposed a new tax bill that seeks to prevent the Alternative Minimum Tax from spreading to more taxpayers next tax season.The bill, sponsored by committee Chairman Max Baucus, D-Mont., and ranking member Chuck Grassley, R-Iowa, increases the AMT exemption amount to $46,200 for individuals and $69,950 for joint filers. It allows the use of personal credits to keep taxpayers who don’t currently pay the AMT from being snared by the tax.
In addition, the bill contains provisions for renewing alternative energy tax incentives and providing college tuition tax deductions and R&D credits. It extends credits for renewable electricity and refined coal production, and adds $400 million to the Clean Renewable Energy Bonds program. Other extensions involve tax credits for solar energy property, qualified fuel cell property, and energy-efficient appliances, commercial buildings and residences.
The bill also extends the itemized deduction for state and local general sales taxes, qualified tuition deduction, the teacher educational expense deduction, and the ability to make tax-free contributions from an IRA plan to a qualified charitable organization. In addition, the bill contains a variety of provisions for the military, businesses such as racetracks and mines, and the IRS.
