You may not know about the Alternative Minimum Tax because you’ve never had to pay it before. But if you have had to pay it, you may have wondered what in the world it is for and how it is figured. The AMT is an income tax imposed at nearly a flat rate on an adjusted amount of taxable income above a certain threshold. If you have a higher income, you may be subject to the AMT.
Know when the AMT applies. You may have to pay the AMT if your taxable income, plus certain adjustments, is more than your AMT exemption amount. Your filing status and income define the amount of your exemption. In most cases, if your income is below this amount, you will not owe the AMT.
Know exemption amounts. The 2015 AMT exemption amounts are:
• $53,600 if you are Single or Head of Household.
• $83,400 if you are Married Filing Jointly or Qualifying Widow(er).
• $41,700 if you are Married Filing Separately.
You will reduce your AMT exemption if your income is more than a certain amount.
Hire a professional tax professional. Our staff is well versed relative to the Alternative Minimum Tax and can be your trusted partner in developing a long-term tax strategy. Our goal is to keep our clients from paying more tax than is necessary and we work hard to stay abreast of the ever-changing tax laws in order to do this.
Call our office today and let’s start the conversation!