Research Report The 15 Percent Rate on Capital Gains: A Casualty of the Alternative Minimum Tax
Greg Leiserson
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Tax rate reductions on long-term capital gains and qualifying dividends were a key, highly touted component of the tax cuts passed in the Jobs and Growth Tax Relief Reconciliation Act of 2003 (JGTRRA). However, like the 20012006 tax cuts more broadly, taxpayers affected by the individual alternative minimum tax (AMT) may not pay the advertised lower rates. This article explains the interaction between the capital gains rate and the AMT and provides example tax calculations for two sample taxpayers.
Research Areas Taxes and budgets
Tags Individual taxes Federal budget and economy
Policy Centers Income and Benefits Policy Center