The Expanding Reach of the Individual Alternative Minimum Tax

Research Report

The Expanding Reach of the Individual Alternative Minimum Tax

Abstract

Both the original minimum tax and its successor, the individual alternative minimum tax (AMT), have applied in the past to a small minority of high-income households. But barring a change in law, this "class tax" will soon be a "mass tax." By the end of the decade, repealing the AMT will cost more than repealing the regular income tax. This paper explains how a tax originally designed to target 155 taxpayers could grow to cover 36 million, discusses economic issues related to the alternative minimum tax and examines options for reform.

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