The Alternative Minimum Tax (AMT) ensures high-income taxpayers pay a minimum amount of income tax, but amendments in 1986 shifted its focus to upper-middle-class taxpayers. It is a complex parallel tax system that requires taxpayers to calculate their obligations under both systems and pay the higher of the two. Tax strategies to avoid paying the […]
The AMT calculation determines if a taxpayer must pay additional tax to compensate for excessive deductions. It uses a fixed deduction and taxable fees, and if the resulting figure is higher than the standard tax obligation, the taxpayer must pay the higher amount. The AMT affects more people over time as its limits do not […]
