cougarguard.com — unofficial BYU Cougars / LDS sports, football, basketball forum and message board  

Go Back   cougarguard.com — unofficial BYU Cougars / LDS sports, football, basketball forum and message board > non-Sports > Finances

Reply
 
Thread Tools Display Modes
Old 11-12-2007, 05:13 PM   #1
TripletDaddy
Senior Member
 
Join Date: Oct 2007
Location: Orange County, CA
Posts: 9,483
TripletDaddy can only hope to improve
Default AMT Patch passes in the House

The Bill that Sen Rengel (Dem, NY) proposed was passed by The House late last week. Step 1 out of the way.

Now to see whether the Senate passes it.

It was estimated that AMT was going to bite about 25 million people in the rear at an average of about $2,500 per taxpayer, mostly people who are "borderline" waelthy, meaning not the uber-rich, but college grads who are doing well for themselves and earing a nice salary, but are no means millionaires.

The proposed patch would increase the exemption for joint filers to $66,250 and for individuals, $44,350.

Interestingly, Harry Reid has stated that the Senate will not pass an AMT patch before December. I guess Senators need 4 weeks off before they reconvene in mid-December and then take another 4 weeks off....
__________________
Fitter. Happier. More Productive.

"Everyone is against me. Everyone is fawning for 3D's attention and defending him." -- SeattleUte
TripletDaddy is offline   Reply With Quote
Old 11-12-2007, 05:16 PM   #2
MikeWaters
Demiurge
 
MikeWaters's Avatar
 
Join Date: Aug 2005
Posts: 36,363
MikeWaters is an unknown quantity at this point
Default

Is there a way of figuring out beforehand what the risk is of being hit with AMT?

I'm thinking about prepaying tithing for next year, and it would be a bummer to to be hit with the AMT as a result.
MikeWaters is offline   Reply With Quote
Old 11-12-2007, 05:20 PM   #3
TripletDaddy
Senior Member
 
Join Date: Oct 2007
Location: Orange County, CA
Posts: 9,483
TripletDaddy can only hope to improve
Default

Quote:
Originally Posted by MikeWaters View Post
Is there a way of figuring out beforehand what the risk is of being hit with AMT?

I'm thinking about prepaying tithing for next year, and it would be a bummer to to be hit with the AMT as a result.
Sure, you can use standard tax software to est whether you will be in AMT. I would assume a turbo tax-type suite would do it for you, as I know they also do est tax payments and other basic tax planning. If not turbo tax, then maybe one of the other ones.

Why would you pre-pay tithing and why pre-paying it put you in AMT?

One option you may want to explore is to have your employer pay you in breadfruit. The IRS doesnt tax that.
__________________
Fitter. Happier. More Productive.

"Everyone is against me. Everyone is fawning for 3D's attention and defending him." -- SeattleUte
TripletDaddy is offline   Reply With Quote
Old 11-17-2007, 01:46 AM   #4
Filsdepac
Junior Member
 
Filsdepac's Avatar
 
Join Date: May 2006
Location: Mountain View, CA
Posts: 68
Filsdepac is on a distinguished road
Default

Hey Triplet, could you explain the other half of the bill in lemuel's terms? Isn't there a huge tax increase if you make more than $250K? Not that this would affect me, but i'm curious.
Filsdepac is offline   Reply With Quote
Old 11-17-2007, 02:16 PM   #5
TripletDaddy
Senior Member
 
Join Date: Oct 2007
Location: Orange County, CA
Posts: 9,483
TripletDaddy can only hope to improve
Default

Quote:
Originally Posted by Filsdepac View Post
Hey Triplet, could you explain the other half of the bill in lemuel's terms? Isn't there a huge tax increase if you make more than $250K? Not that this would affect me, but i'm curious.
Mr Sparkle! by "other half of the bill," do you mean the rest of the bill, whether it pertains to AMT (because he proposed other things pertaining to C corps, credits, etc) or are you simply asking how AMT works?
__________________
Fitter. Happier. More Productive.

"Everyone is against me. Everyone is fawning for 3D's attention and defending him." -- SeattleUte
TripletDaddy is offline   Reply With Quote
Old 11-19-2007, 03:56 AM   #6
Filsdepac
Junior Member
 
Filsdepac's Avatar
 
Join Date: May 2006
Location: Mountain View, CA
Posts: 68
Filsdepac is on a distinguished road
Default

I thought I heard, and perhaps I'm wrong, that in addition to AMT changes, there would be an increase in taxes for individuals in higher tax brackets. Like their capital gains would be taxed as ordinary income or something. Again, I might have heard wrong, is there any 'downside' to this bill?
Filsdepac is offline   Reply With Quote
Old 11-19-2007, 04:00 PM   #7
TripletDaddy
Senior Member
 
Join Date: Oct 2007
Location: Orange County, CA
Posts: 9,483
TripletDaddy can only hope to improve
Default

Quote:
Originally Posted by Filsdepac View Post
I thought I heard, and perhaps I'm wrong, that in addition to AMT changes, there would be an increase in taxes for individuals in higher tax brackets. Like their capital gains would be taxed as ordinary income or something. Again, I might have heard wrong, is there any 'downside' to this bill?
Well, not sure what you heard, but off the top of my head, if the House ever passed a bill that started taxing long term capital gains as ordinary income, I think we would literally see a riot in the streets. That would be unfathomable. That could be a difference of 30-something percent difference in taxation for some people.

The bill has proposed offsets ("revenue raisers") to help fund the proposed AMt patch. This is standard on the Hill. You cant propose cutting a tax without raising a different one. Also, keep in mind that the AMT patch is only one of several things being proposed.....also included is another extension for fed R&D, taxation on stocks, and other corporate incentives.

In the case of AMT, from a policy perspective, it would make little sense to give the public a reprieve from AMT and then raise income taxes for higher income earners....since they are the ones who are paying AMT to begin with.

Thus far, some revenue raisers that have been suggested include several significant changes in the taxation of private equity investments. Foremost, the legislation would raise an estimated $25.6 billion over 10 years by requiring investment fund managers to treat income received from carried interests as compensation taxed as ordinary income and subject to payroll taxes to the extent that it does not represent a reasonable return of investment. Capital gains rates would still apply to the amount that represents a reasonable return on capital. Anyway, without boring everyone, the point I am trying to make is that revenue raisers that do not directly kill individuals will offset the AMT patch.

Fun stuff.
__________________
Fitter. Happier. More Productive.

"Everyone is against me. Everyone is fawning for 3D's attention and defending him." -- SeattleUte
TripletDaddy is offline   Reply With Quote
Old 11-19-2007, 11:10 PM   #8
Filsdepac
Junior Member
 
Filsdepac's Avatar
 
Join Date: May 2006
Location: Mountain View, CA
Posts: 68
Filsdepac is on a distinguished road
Default

Quote:
Originally Posted by TripletDaddy View Post
Thus far, some revenue raisers that have been suggested include several significant changes in the taxation of private equity investments. Foremost, the legislation would raise an estimated $25.6 billion over 10 years by requiring investment fund managers to treat income received from carried interests as compensation taxed as ordinary income and subject to payroll taxes to the extent that it does not represent a reasonable return of investment. Capital gains rates would still apply to the amount that represents a reasonable return on capital.
That's what I'm talking about! Sorry, I should have been more specific. I had heard that the carry on investment disposals that the general partners at VCs take will be taxed at 44%. I knew it was for only the very high earners, just couldn't remember the specifics.

I'm auditing a VC right now, and the tax people were talking about this when I overheard it. I really need to brush up on my tax stuff, I passed the Reg portion of the CPA exam a year ago, but forgot everything.


Off topic, just curious if this quote thing works as easily as it seems:

Quote:
Originally Posted by SeattleUte View Post
Utah sucks and will be destroyed by BYU.
Filsdepac is offline   Reply With Quote
Old 12-20-2007, 12:34 AM   #9
TripletDaddy
Senior Member
 
Join Date: Oct 2007
Location: Orange County, CA
Posts: 9,483
TripletDaddy can only hope to improve
Default

After much wrangling between Dems and Reps, the AMT patch for TY 2007 has been passed. President Bush will likely sign it tomorrow or Fri.

The Reps stood firm and forced the Dems into a patch that basically had not revenue offsets. Not sure how we will pay for this patch without offsets somewhere, but at least it has been passed.

Now the rub....because it has taken so long to pass the patch, it is going to take awhile for the Service to reconfigure all their software to reflect the patch. Some estimates are at 8 or 10 weeks. This means no income tax returns processed until at least early to mid February.

Breathe easy....for now. The patch is only good for one year.
__________________
Fitter. Happier. More Productive.

"Everyone is against me. Everyone is fawning for 3D's attention and defending him." -- SeattleUte
TripletDaddy is offline   Reply With Quote
Old 12-21-2007, 03:58 PM   #10
Donuthole
Junior Member
 
Donuthole's Avatar
 
Join Date: Aug 2007
Posts: 175
Donuthole is on a distinguished road
Default

Quote:
Originally Posted by TripletDaddy View Post
The proposed patch would increase the exemption for joint filers to $66,250 and for individuals, $44,350.
Where was the exemption before the tax passed?
__________________
Join the Prospective Utah Student Section today!
Donuthole is offline   Reply With Quote
Reply

Bookmarks

Thread Tools
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off

Forum Jump


All times are GMT. The time now is 11:25 PM.


Powered by vBulletin® Version 3.8.2
Copyright ©2000 - 2024, Jelsoft Enterprises Ltd.