Alternative Minimum Tax and Wisconsin Voters

If you don't already know about the Alternative Minimum Tax, you will, and likely soon.

It won't be a pleasant experience. The AMT was designed to tax those whose incomes were large, but who played all the games (legally) to avoid Federal income taxes. At the time it was passed, incomes were lower, and there has been little (if any) inflation-adjustment.

By 2010, "the AMT will become the de facto tax system for filers in the $200,000 to $500,000 income range, 94 percent of whom will face the tax," says a report by the Tax Policy Center. About half of tax filers making $75,000 to $100,000 will have to pay the tax, including 89 percent of married couples in that bracket who have at least two children.

The Republican majority in Congress simply did not address this issue--instead, they passed tax-reduction. As it turns out, the Democrats (!!!), led by Rangel, WILL address this issue in January.

Oh, well. The Pubbies lost for a reason, eh?

Anyway, Charlie pointed out a Wisconsin CNN exit-poll which may tell us why the AMT is on the front burner. Under "Vote By Income," note that 35% of Wisconsin voters earned over $75K (the trip-wire for AMT in a lot of cases) and that Doyle took almost half of the voters in the $75-150K earnings range.

If the Wisconsin numbers are an indication of the national numbers, that means that the Dems are seeing a very noticeable group of supporters who WILL be affected by the AMT in the near future.