Democrats Seek Formula To Blunt AMT - Mercedes-Benz Forum

LinkBack Thread Tools Display Modes
post #1 of 7 (permalink) Old 06-08-2007, 08:21 AM Thread Starter
Jakarta Expat's Avatar
Date registered: Aug 2006
Vehicle: PM me to Join the Expat Muslims for Obama Club........
Location: Jakarta, Indonesia
Posts: 17,697
Mentioned: 0 Post(s)
Quoted: 4 Post(s)
(Thread Starter)
Democrats Seek Formula To Blunt AMT

Democrats Seek Formula To Blunt AMT
One Plan Would Impose Surtax Of 4.3% on Richest Households

House Democrats looking to spare millions of middle-class families from the expensive bite of the alternative minimum tax are considering adding a surcharge of 4 percent or more to the tax bills of the nation's wealthiest households.
Under one version of the proposal, about 1 million families would be hit with a 4.3 percent surtax on income over $500,000, which would raise enough money to permit Congress to abolish the alternative minimum tax for millions of households earning less than $250,000 a year, according to Democratic aides and others familiar with the plan.
Rep. Richard E. Neal (D-Mass.), chairman of the House subcommittee with primary responsibility for the AMT, said that option would also lower AMT bills for families making $250,000 to $500,000. And it would pay for reductions under the regular income tax for married couples, children and the working poor.
All told, the proposal would lower taxes for as many as 90 million households, and Neal said it has broad support among House leaders and Democrats on the tax-writing House Ways and Means Committee. "Everybody's on board," he said.
Neal has yet to release details of the plan, however, and others inside and outside the committee say major pieces of it are still in flux. Some Democrats say Neal's plan stretches the definition of the middle class too far, providing AMT relief to too many wealthy households. They argue that the cutoff for families to be spared from the AMT should be lower, at $200,000, $150,000 or even $75,000.
"There is consensus to make sure that we have some responsible tax policy that will also treat taxpayers fairly. No one ever expected to be caught in the AMT making 75 grand," said Rep. Xavier Becerra (D-Calif.), a Ways and Means Committee member whose Los Angeles district is populated by working poor. "We're trying to come up with a fix that does right by the great majority of Americans who fall into the middle class."
The debate has focused attention on a different surtax proposed by the Tax Policy Center, a joint project of the Urban Institute and the Brookings Institution. That plan would eliminate the AMT and replace it with a 4 percent surcharge on income over $200,000 for families and $100,000 for singles, cutting taxes for 22 million households and raising them for more than 3 million.
"Our plan is as simple as can be. And only 2 percent of the whole population would have to pay it," said Leonard E. Burman, director of the Tax Policy Center. The plan has the added benefit of abolishing the complicated AMT at all income levels, Burman said, an approach some lawmakers find attractive.
On the other hand, fewer families' taxes would be cut, diminishing the ability of Democrats to capitalize on the plan politically. Since they took control of Congress in January, Democrats have made repealing or scaling back the AMT a top priority in hope of establishing tax-cutting credentials and seizing the issue from Republicans for the 2008 campaign.
The alternative minimum tax is a parallel tax structure created in 1969 to nab 155 super-rich tax filers who had been able to wipe out their tax bills using loopholes and deductions. Under AMT rules, taxpayers must calculate their taxes twice -- once using normal deductions and tax rates and once using special AMT deductions and rates -- and pay the higher figure.
Because the AMT was not indexed for inflation, its reach has expanded annually, delivering a significant tax increase this spring to an estimated 4 million households. The AMT would have spread even more rapidly after President Bush's tax cuts reduced taxpayers' normal bills, but Congress enacted yearly "patches" to restrain its growth. The most recent patch expired in December, and unless Congress acts, the tax is projected to strike more than 23 million households next spring, many of them earning as little as $50,000 a year.
House Democrats want legislation to spare those households while also lowering the bills of many current AMT payers. But they face numerous obstacles. In the Senate, Finance Committee Chairman Max Baucus (D-Mont.) favors AMT repeal but considers it too ambitious for this year. Baucus has said another year-long patch is more likely.
In the House, some Democrats argue that more time is needed to explain the issue to the public. The vast majority of households have yet to pay the AMT and may not fully appreciate the value of eliminating the tax, while the wealthy are sure to feel the bite of a new surtax.
"I don't think there's enough of an understanding right now that you've got this tidal tax wave about to hit everybody," said Rep. Chris Van Hollen (D-Md.), a Ways and Means Committee member who is also chairman of the Democratic Congressional Campaign Committee. "From a political perspective, we need to lay the groundwork."
Before the Memorial Day break, Ways and Means Committee Chairman Charles B. Rangel (D-N.Y.) said he hoped to announce an AMT proposal as soon as Congress returned to Washington. But his timetable has slipped to late June, Democratic aides said, with the issue set to go before the full House sometime in July.
Republicans generally oppose new taxes on the wealthy, saying they disproportionately affect small businesses, but are waiting to hear more before deciding whether to work with Democrats or offer their own plan to abolish the AMT.
"House Democrats are going to have to find their sea legs on this issue fast," said Rep. Phil English (R-Pa.), the senior Republican on the Ways and Means tax subcommittee. "Folks seem to be launching a lot of trial balloons, and it's all very festive. But I don't have enough really to react to yet."

Democrats Seek Formula To Blunt AMT -
Jakarta Expat is offline  
Sponsored Links
post #2 of 7 (permalink) Old 06-08-2007, 10:17 AM
BenzWorld Elite
wbain's Avatar
Date registered: Dec 2003
Vehicle: 1965 220S, 1999 Volvo V70 (wagon), 2006 Ford Crown Vic Police Interceptor, 72 350SL 4 Speed
Location: Near Manassas Va.
Posts: 1,830
Mentioned: 0 Post(s)
Quoted: 4 Post(s)
COngress could adjust the AMT for inflation since the law was written and have an automatic adjustment done every year thereafter, like their salary increases are automatic.

Near Manassas Va. '65 220S, 2006 Ford Crown Victoria Police Interceptor, '99 Volvo V70, '72 350SL 4 speed

Not part of the in-crowd since 1952. It's BRAKES not breaks. You break a bone, use brakes to stop your car. /rant
wbain is offline  
post #3 of 7 (permalink) Old 06-08-2007, 10:30 AM
BenzWorld Elite
Date registered: Sep 2004
Vehicle: 95 E300
Location: Inside my head
Posts: 36,850
Mentioned: 0 Post(s)
Quoted: 392 Post(s)
I love this quote:

"Folks seem to be launching a lot of trial balloons, and it's all very festive."
Botnst is offline  
post #4 of 7 (permalink) Old 06-08-2007, 03:44 PM
BenzWorld Elite
Date registered: Oct 2002
Vehicle: SLK32, ML430
Location: Atlanta, GA
Posts: 6,349
Mentioned: 0 Post(s)
Quoted: 0 Post(s)
I love the guy that says that $500k is way too high and they should set the minimum at $75k. What an ass.
430 is offline  
post #5 of 7 (permalink) Old 06-08-2007, 03:47 PM
BenzWorld Elite
FeelTheLove's Avatar
Date registered: Sep 2004
Vehicle: 83 Astral Silver 280 SL
Location: Planet Houston
Posts: 28,829
Mentioned: 0 Post(s)
Quoted: 8 Post(s)
Tax the rich, feed the poor until there are no rich no more.

Recall that earlier generations faced down fascism and communism not just with missiles and tanks, but with sturdy alliances and enduring convictions. They understood that our power alone cannot protect us, nor does it entitle us to do as we please. Instead, they knew that our power grows through its prudent use; our security emanates from the justness of our cause, the force of our example, the tempering qualities of humility and restraint.

-President Barack Obama, 1st Inaugural address
FeelTheLove is offline  
post #6 of 7 (permalink) Old 06-08-2007, 05:18 PM
Moderately subtle
edfreeman's Avatar
Date registered: Dec 2003
Vehicle: 94 E500, 97 500SL
Location: Soddy Daisy, TN
Posts: 9,613
Mentioned: 2 Post(s)
Quoted: 112 Post(s)
Lifetime Premium Member
Send a message via AIM to edfreeman
Actually, if the issue is the loopholes and deductions that allow rich folks to escape taxes, they could just fix those . . .

edfreeman is offline  
post #7 of 7 (permalink) Old 06-08-2007, 05:40 PM
BenzWorld Elite
Date registered: Sep 2004
Vehicle: 95 E300
Location: Inside my head
Posts: 36,850
Mentioned: 0 Post(s)
Quoted: 392 Post(s)
Originally Posted by FeelTheLove
Tax the rich, feed the poor until there are no rich no more.
Everywhere is freaks and hairies
Dykes and fairies, tell me where is sanity
Tax the rich, feed the poor
Till there are no rich no more

I'd love to change the world
But I don't know what to do
So I'll leave it up to you
Botnst is offline  
Sponsored Links

  Mercedes-Benz Forum > General Mercedes-Benz Forums > Off-Topic

Quick Reply

Register Now

In order to be able to post messages on the Mercedes-Benz Forum forums, you must first register.
Please enter your desired user name, your email address and other required details in the form below.

User Name:
Please enter a password for your user account. Note that passwords are case-sensitive.


Confirm Password:
Email Address
Please enter a valid email address for yourself.

Email Address:


Human Verification

In order to verify that you are a human and not a spam bot, please enter the answer into the following box below based on the instructions contained in the graphic.

Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
Thread Tools
Show Printable Version Show Printable Version
Email this Page Email this Page
Display Modes
Linear Mode Linear Mode

Similar Threads
Topic Author Forum Replies Last Post
"Seek" radio button broke, need replacement tfalater General Mercedes-Benz 1 07-03-2006 05:05 PM
Hide & Seek, It's not in the manual! Arn560 W203 C-Class 5 04-14-2005 08:30 AM
hide and seek cd changer on 02 ml320 blackshark W163 M-Class 0 01-08-2005 06:47 AM
How to seek tracks on Audio 10 CD Player Guest (MBNZ) W203 C-Class 10 09-10-2002 06:40 AM

Posting Rules  
You may post new threads
You may post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are On
Pingbacks are On
Refbacks are On


Title goes here

video goes here
description goes here. Read Full Story
For the best viewing experience please update your browser to Google Chrome