Grassley to Propose AMT Shield Legislation

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Sen. Charles Grassley, R-Iowa, the ranking member on the Senate Finance Committee, said on Wednesday that he would propose legislation that would exempt first-time alternative minimum tax (AMT) filers in 2007 from underpayment penalties for failure to have paid enough taxes throughout the year, CNNMoney.com reported.

The expectation is that Congress will act to shield the 20 million filers at risk at least for 2007. On Wednesday, Max Baucus, D-Montana, chairman of the Senate Finance committee, said lawmakers would pass at least a short-term patch for this year, although not before dealing with other issues, such as healthcare, according to the publication Congress Daily.

A patch would include an increase in the amount of income that may be exempted from your AMT calculations. Those income exemption levels haven't kept pace with the times since the AMT's inception almost 40 years ago CNNMoney.com reported.

But even if Congress does pass a patch, the Joint Committee on Taxation estimates that 5.4 million tax filers will be subject to the AMT in 2007, up from 4.2 million last year, CNNMoney.com reported.- New York State Society of Certified Public Accountants

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Posted July 4th, 2007 by Alla