CRAPO CALLS FOR IMMEDIATE REPEAL OF AMT
Alternative Minimum Tax threatens nearly 90,000 Idaho families
Washington, DC - Close to 90,000 Idaho families may be facing an unexpected tax if Congress doesn't act quickly to end an outdated federal income tax. In a news conference on Capitol Hill today, Idaho Senator Mike Crapo said that the Alternative Minimum Tax (AMT) is now threatening tens of millions of middle-income Americans. The tax, created in 1969 to stop a handful of wealthy individuals who were legally avoiding paying any taxes, was not indexed for inflation; as a result, millions of middle-income taxpayers are now affected. Crapo warned that if Congress doesn't act now, the stealth tax will reach into increasingly more taxpayers' pockets each year it remains in effect.
"This tax is out of control-in the last tax year (2005), just under 10,000 Idaho families and individuals were subjected to the AMT, but that number will explode to close to 90,000 for this tax year," Crapo said. "That scenario is repeated throughout the country, in each state, with similar explosive numbers. The failure to repeal the AMT means that more than $50 billion in payments and penalties will be collected from middle-income Americans, which was never intended to happen. Idaho families with an adjusted gross income of $20,000 may find themselves unexpectedly facing the AMT. We cannot wait one more year to repeal this onerous tax."
Crapo serves on the Senate Finance Committee, which oversees and writes tax policy. He has joined with committee leadership in sponsoring legislation to permanently repeal the AMT (S. 55). At today's news conference, he was joined by Senate Minority Leader Mitch McConnell (R-Kentucky), Finance Committee Ranking Member Charles Grassley (R-Iowa) and Senator Gordon Smith (R-Oregon) to push for immediate action on the bill. They echoed Crapo's message that repeal must come this year, and that pay-go rules should be waived so that other taxes are not increased as a result of the repeal. Finance Chairman Max Baucus (D-Montana) is the lead sponsor of S. 55, which was introduced on January 4, 2007.
"The Finance Committee should act immediately on this AMT repeal measure, which has already been introduced and endorsed by the Chairman so that we can provide the certainty that middle-income Idahoans and Americans deserve," Crapo added. "Many people don't even know they'll be liable for this tax. The average tax liability they will face may be between $3,300 and $5,800. We need a permanent fix to this problem."
The AMT was originally enacted after Congress discovered that 155 taxpayers making over $200,000 legally paid no taxes at all. Congress originally estimated that the AMT would only affect one in 500,000 taxpayers. In 2001, approximately 2 million people were subject to the AMT, including many Idahoans. The number of people nationwide threatened by the tax is expected to grow to 35 million by the end of the decade if no action is taken.
To directly link to this news release, please use the following address:
# # #