Tonight I was on “On the Money” on CNBC
Tonight I called in as an expert on CNBC’s “On the Money.” The show is all about consumer finance issues, and tonight we were (of course) talking about the bailout bill that the House passed today and President Bush signed into law.
One of the provisions of the bill included a “fix” for 2008 for the Alternative Minimum Tax (AMT). The AMT was created in 1970 to make sure that high-income individuals paid income taxes, even if they had lots of deductions. In its first year, only 19,000 taxpayers paid AMT.
The problem is that the law hasn’t indexed the numbers for inflation, and millions are now paying this punitive tax. What was once meant to hit only high income earnings now will hit middle class Americans unless lawmakers change the law.
The bailout bill specifies that the AMT exemption for 2008 will be increased around $46,000 for single taxpayers, and almost $70,000 for those filing joint. That increase means fewer Americans are subject to AMT, essentially protecting the middle class for another year.
We had an awesome email question from a single taxpayer whose income is around $45,000. She was worried that she might be subject to AMT. That’s a common concern. And she will be happy to know that AMT is not going to affect her.
Those exemption numbers above shouldn’t be confused with your income numbers. The exemption figures are a small part of a larger, complicated formula used to calculate AMT. So who should be worried about AMT? If you’re single and have earnings of $100,000 or more, and if you’re married filing jointly and have earnings of $175,000 or more, you’re likely to be subject to AMT.
These aren’t hard and fast numbers. They’re just rules of thumb, and if you’re even close to these figures, you might want to sit down with a professional tax preparer to go over your situation in detail.
The blah blah blahs: The above information should not be construed as tax advice. Each situation is different, and you should discuss your particular situation with a qualified tax professional.
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Tags: alternative minimum tax, amt, carmen wong ulrich, cnbc, on the money
Comments (2)
Tracy ..
Great stuffs! I was wondering if you or someone you knew could get the video subtitled/captioned for those with hearing loss or are deaf (or people with non-functioning ears).
I am deaf. I know many people would love to see the video subtitled/captioned if possible. With the Baby Boomer population needing more information and resources to understand that information (i.e. cochlear implants, captioning/subtitling of video mediums, etc.), it might be an idea worth considering.
Love your stuff!
Thanks!
Paotie
Paotie – Where does one begin with that?