Alternative Minimum Tax: Will You Have to Pay AMT?

Before you go, we thought you'd like these...
Before you go close icon

Many think of the Alternative Minimum Tax as something only rich people pay. But even with tax reform having reduced its bite, the AMT still affects many upper-middle income taxpayers.

In the following video, Dan Caplinger, The Motley Fool's director of investment planning, talks about the AMT and how it's a completely separate tax system that can add thousands to your tax bill. Because it uses different deductions and exemptions, the AMT can lead to higher taxes in some cases, especially for those who live in states with high state and local tax burdens. Dan notes that higher AMT exemptions and higher ordinary tax rates should make fewer people subject to AMT, but with almost 4 million taxpayers paying an average of $6,600, it's worth looking at the AMT and considering any measures available to reduce its impact.

Take advantage of this little-known tax "loophole"
Recent tax increases have affected nearly every American taxpayer. But with the right planning, you can take steps to take control of your taxes and potentially even lower your tax bill. In our brand-new special report "The IRS Is Daring You to Make This Investment Now!," you'll learn about the simple strategy to take advantage of a little-known IRS rule. Don't miss out on advice that could help you cut taxes for decades to come. Click here to learn more.

The article Alternative Minimum Tax: Will You Have to Pay AMT? originally appeared on

Dan Caplinger and the Motley Fool have no position in any stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Copyright © 1995 - 2014 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

Read Full Story

Sign up for Finance Report by AOL and get everything from business news to personal finance tips delivered directly to your inbox daily!

Subscribe to our other newsletters

Emails may offer personalized content or ads. Learn more. You may unsubscribe any time.

People are Reading