I was just double-checking my tax prediction spreadsheet today. I discovered I hadn't updated my AMT rules for 2012, and so went to go see what they are.
I couldn't find them, because they don't exist! What apparently will happen by default is that the AMT exemption will plummet from $74,450 to the year 2000 value of $45,000.
This change makes a huge difference in my projected tax bill. And I guarantee that if it happens, a LOT of people who've never paid AMT (and probably have never heard of it) will end up not having had enough tax withheld, and therefore owe interest and penalties.
That makes me assume that it will be addressed in time. But who really knows what they'll be able to agree on. In the meantime, I suppose I need to start saving for my tax bill as though I owe the higher amount, and maybe you should too...
Is it not a dereliction of duty for them to leave us taxpayers twisting in the wind like this???
AMT cliff
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Re: AMT cliff
Politicians? Dereliction of duty?Xan wrote: Is it not a dereliction of duty for them to leave us taxpayers twisting in the wind like this???
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Pointedstick
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Re: AMT cliff
Fixed it for you.Xan wrote: Is it not a dereliction of duty for them to <insert anything congress does here> ??
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Re: AMT cliff
As long as you pay in 100% of your prior year tax in withholding and pay the balance by 4/15, there should be no interest/penalties for the people you speak of. May be 110% depending on income.
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Re: AMT cliff
Ah, good point, Moda. Still, it could be a big chunk of money due 4/15 by surprise.
Re: AMT cliff
I suspect that the fiscal cliff issues will be resolved right after the election in the lame duck session.
Re: AMT cliff
The 110% is not comforting. Unless you are really into the I-bond tax refund.moda0306 wrote: As long as you pay in 100% of your prior year tax in withholding and pay the balance by 4/15, there should be no interest/penalties for the people you speak of. May be 110% depending on income.
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alvinroast
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Re: AMT cliff
Am I right in thinking this still hasn't been fixed? The only info I can find is articles from last year saying that of course it will get fixed like it always does or recent articles about how the change will slow down everyone's refunds.
Hello! What refunds? An extra 28+ million middle class people are getting hit with the AMT for 2012. Why doesn't anyone seem to care about this?
I talked my wife into not putting more money into her 401k half way through the year because of the atrocious fees. Now I'm wondering if it's better to pay it in fees to a lame fund company than to the IRS.
Does anyone think there is still a chance that this gets fixed for 2012?
Hello! What refunds? An extra 28+ million middle class people are getting hit with the AMT for 2012. Why doesn't anyone seem to care about this?
I talked my wife into not putting more money into her 401k half way through the year because of the atrocious fees. Now I'm wondering if it's better to pay it in fees to a lame fund company than to the IRS.
Does anyone think there is still a chance that this gets fixed for 2012?
Re: AMT cliff
I'm pretty sure the AMT cliff was fixed in the Senate bill that was passed on New Years day.alvinroast wrote: Am I right in thinking this still hasn't been fixed? The only info I can find is articles from last year saying that of course it will get fixed like it always does or recent articles about how the change will slow down everyone's refunds.
Hello! What refunds? An extra 28+ million middle class people are getting hit with the AMT for 2012. Why doesn't anyone seem to care about this?
I talked my wife into not putting more money into her 401k half way through the year because of the atrocious fees. Now I'm wondering if it's better to pay it in fees to a lame fund company than to the IRS.
Does anyone think there is still a chance that this gets fixed for 2012?
"I came here for financial advice, but I've ended up with a bunch of shave soaps and apparently am about to start eating sardines. Not that I'm complaining, of course." -ZedThou
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alvinroast
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Re: AMT cliff
That's a relief. I still hadn't seen anything about it and thought it odd, but then I'm not allowed to listen to MMM since it makes me crazy. 
Thanks for the update Storm.
Thanks for the update Storm.Re: AMT cliff
It's not all roses, however. It looks like it was linked to inflation, but the AMT still hits people making what I consider to be lower middle class income in the NY area:
http://www.cnbc.com/id/100348786
Median household income in NY county is $67,204: http://quickfacts.census.gov/qfd/states/36/36061.html
http://www.cnbc.com/id/100348786
Median household income in NY county is $67,204: http://quickfacts.census.gov/qfd/states/36/36061.html
It still sucks for most households in NY county...For instance, the AMT exemption for 2012 has been raised to $50,600 for singles, up from $33,750, and $78,750 for married couples, up from $45,000. That will keep millions of lower-income Americans from paying the tax.
"I came here for financial advice, but I've ended up with a bunch of shave soaps and apparently am about to start eating sardines. Not that I'm complaining, of course." -ZedThou
Re: AMT cliff
Boy, it sure does. Plus I understand they're more likely to be hit with the AMT. :-PStorm wrote:It still sucks for most households in NY county...