The Bush administration has proposed a one-year, $7 billion patch by exempting households earning less than $58,000.
Sounds good, finally the common folk can get something back.
But wait that’s too simple, beware the Alternative Minimum Tax.
The AMT was instituted in the late 1970s, when top tax rates hit 90 percent and numerous tax shelters offered huge write-offs for the wealthy. The aim of the AMT was to ensure that wealthy people actually paid tax, regardless of how cleverly they sheltered their income.
Today the AMT hits roughly 1 percent of all taxpayers with income between $50,000 and $100,000 and 4.5 percent of those earning between $100,000 and $200,000.
It’s expected to affect nine million Americans by 2009.
Another one to add to my “why not to move to the US” list.