Alternative Minimum Tax (AMT)

[MyTwoAs]

I've been preparing our taxes over the past few weeks and we're not going to be hit with the alternative minimum tax (AMT) for 2009 but we may be dealing with it for 2010. I've been reading about the AMT on the IRS website and although I enjoy taxes and I've been doing my own since I was 16, I'm pretty much confused. I can't find anything concrete that says if A then B. I know that it can trigger for married couples filing jointly with an AGI of under $150k but does it automatically trigger for married couples filing jointly with an AGI of above $150k?

We're planning on hiring a CPA to do our 2010 taxes but I'm trying to plan ahead a bit here. I'm looking for some web resources that better explains the AMT...at least in easier-to-understand terms than the IRS website does.

Any tax experts out there?

Thanks!

[applecider]

I'm not a tax expert but I do have an accounting degree and I did take an income tax class for that degree. The AMT is really confusing but it's mostly so that if you have found all the loopholes for deductions and you don't owe much tax even though have a high income, you basically won't get away with it!

Did you find the little AMT assistant calculator on the IRS website? That seems to be helpful in determining whether you will have to pay.

That's about all I got!

[Smithie]

Also not a tax expert, but we flirted with the AMT for a couple of years there when DH was making a high salary. He says a workable rule of thumb is: if a married couple filing jointly is making 100K or over per year AND paying less that 22% of their AGI in federal taxes when the taxes are done in the standard way, it's time to freak out about the AMT possibly kicking in.

[MyTwoAs]

Thanks! I didn't see the AMT assistant calculator so I will check that out. According to TurboTax, we have lower than average deductions so I'm sure that helps a bit. Thanks again!!

[MyTwoAs]

Originally Posted by Smithie

Also not a tax expert, but we flirted with the AMT for a couple of years there when DH was making a high salary. He says a workable rule of thumb is: if a married couple filing jointly is making 100K or over per year AND paying less that 22% of their AGI in federal taxes when the taxes are done in the standard way, it's time to freak out about the AMT possibly kicking in.

In 2009 we paid less than 22% of our AGI in federal taxes but I'm self-employed so that kind of skews things. I filled out the assistant and it directed me to Form 6251.

I think I've decided that I'm just going to speak with a CPA/tax accountant so that we can plan ahead. I would hate to get hit with a surprise $10k AMT tax next year when I can divert that into a pre-tax 401(k), thus reducing our taxable income and knocking me out of AMT range.

Again, thank you both for chiming in. I admit defeat, this is way above me.