Suchergebnisse

This report discusses the alternative minimum tax (AMT), which was enacted to ensure everyone pays a minimum of federal taxes.

"We take a first look at limitations on the use of energy-related tax credits contained in the General Business Credit (GBC) due to limitations within the regular corporate income tax as well as the AMT. Between 2000 and 2005, firms were unable to use all energy-related tax credits due to GBC limitations in the regular tax. The AMT has a smaller but still pronounced impact on the ability of firms to use these credits. Finally, we provide some illustrative calculations to demonstrate how the AMT can lead to very different levelized costs of producing electricity from a wind power project"--National Bureau of Economic Research web site

Front Cover -- Title Page -- Copyright Page -- Contents -- Preface -- Introduction -- Chapter 1: Basics of the AMT -- Filing Form 6251, the Alternative Minimum Tax-Individuals -- AMT Roadmap -- AMT Exemptions -- AMT Rates -- Capital Gains -- Chapter 2: Common AMT Adjustments -- Incentive Stock Options -- Limitation on Deductions -- Chapter 3: Unlikely AMT Adjustments -- Alcohol Fuel Credit -- Basis Adjustment -- Circulation Costs -- Depreciation -- Installment Sales -- Long-Term Contracts -- Mining Costs -- Net Operating Loss -- Passive Activity Losses -- Pollution Control Facilities -- Tax Shelter Farm Activity -- Chapter 4: Tax Preference Items -- Accelerated Depreciation (pre-1987) -- Depletion -- Intangible Drilling Costs -- Small Business Stock Exclusion -- Tax-Exempt Interest -- Chapter 5: Importance of the AMT Credits -- Nonrefundable Personal Credits -- Foreign Tax Credit -- Minimum Tax Credit -- Chapter 6: AMT Planning -- Tax Planning -- AMT Planning Specifics -- Specific AMT Planning Tips -- Comprehensive AMT Problems -- Final Thoughts -- Glossary -- Appendix A: Alternative Minimum Tax-Instructions and Form -- Appendix B: AMT Audits -- Index -- About the Author.

The Tax Reform Act of 1986 (TRA86) ushered in a new package of tax reform in the United States. So great was the change, that the 1954 Internal Revenue Code was replaced by a newer, updated, 1986 model. The new Code was designed to promote greater fairness within the system. Fairness, both real and perceived, was considered key in perpetuating confidence in a system based on self-assessment. As a cornerstone to the 1986 Code, a totally reworked alternative minimum tax, or AMT, was introduced. The new AMT superceded earlier versions in that it became a parallel system to the regular tax, as it had been an addon system in years previous. The AMT had as its stated intention a broadening of the tax base such that all taxpayers would share in the tax burden. With all taxpayers so sharing, all would believe that they had been treated fairly. This report took note of the intent of Congress in implementing the AMT, and then proceeded to analyze the secondary system both on a segmented basis (preference by preference, adjustment by adjustment), and later in an overall sense. Based on the analysis, the intentions of Congress were determined to be expedient and political, designed more to aid in reelection efforts than for the good of the country. Recommended as an alternative to the parallel regime, a one-tiered system was (re) introduced. The system would be kept as "flat" as possible, with limited incentives included as an exchange for less progressivity in tax rates. In the event some stimulus was needed in the economy, the necessary incentive would be codified and the rates adjusted. The likelihood of the American people experiencing Congressional action of a less political nature in the future was determined to be remote, so for new taxpayers may only receive comfort in remembering that hope springs eternal.

This report discusses the legislative activity in the 110th Congress related to the alternative minimum tax (AMT), which was originally enacted to ensure that all taxpayers, especially high-income taxpayers, pay at least a minimum amount of federal taxes.

An alternative minimum tax (AMT) is often regarded as desirable. We analyze a wealth tax at corporate and personal level that is designed as an AMT as proposed by the German Green Party. This wealth tax is imputable to profit taxes and is hence intended to prevent multiple (multistage) taxation. Referring to data from annual reports and the German Central Bank we model enterprises of different structure, industry, size and legal status. We show that companies in the service sector which generally maintain rather high gearing rates are more frequently subjected to the wealth tax than capital intensive industries. This result runs counter to well-known effects of a common wealth tax. Capital intensive firms, e.g. in the metal industry, are levied with definitive wealth tax only if they have large loss carry-forwards or extremely volatile profits. Furthermore, partnerships often enjoy wealth tax privileges due to uniform taxation at individual level whereas corporations may suffer from the wealth tax at corporate and personal level caused by imputation backlogs. Obviously, the underlying AMT influences corporate dividend policy evoking a push-out effect. We prove that this kind of wealth taxation usually favors financial rather than real investment and encourages outbound investment. Consequently, introducing an AMT discriminates against many firms and investment projects, especially if economic income is lower than taxable income. This proves that whenever income is taxed correctly, AMT is dispensable.