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The reality:
The AMT is an "Alternative" Tax system. You should always calculate both your tax liability under both the standard system and the AMT system. You are required to pay the higher of the 2.
The problem:
AMT, unlike the standard tax system, is not indexed for inflation. So, the tax brackets are adjusted by about 3% a year right now, so that you are not thrown into a higher bracket do to inflation alone. Unfortunately, the AMT brackets are fixed, not indexed. So a system designed to catch people with high income and large amounts of deductions and "MAKE THEM PAY THIER FAIR SHARE", is now catching "ORDINARY" people.
Just remember this. EVERY tax was originally designed to tax high income people, but usually was adjusted purposively or through neglect, until it maximizes the amount of taxes collected.
Can AMT be fixed? Sure. Congress and the President can pass a law to index the AMT brackets. Why don't they? The country needs the money. Personally, the AMT is a "Fairer" tax, since it minimizes deductions and it flatter. It might be better if we just abolish the regular tax code and "Fix" the AMT.
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James
The pessimist complains about the wind; the optimist expects it to change; the engineer adjusts the sails.- William Arthur Ward (1921-1994)
Red-beard for President, 2020
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