Bush Signs Alternative Minimum Tax Relief Law
President Bush has signed into law a bill providing relief from the alternative minimum tax (AMT) for many middle-income households. Reuters reports that the AMT "was enacted in 1969 to make sure rich people did not take advantage of so many breaks that they paid no income tax. But more middle class people have been exposed to the AMT as their incomes have risen with inflation." Reuters also states that the AMT tax relief "will ensure that most families earning less than $150,000 a year will not pay the tax. If Congress had failed to enact relief, families making $67,000 could have been subject to the tax." According to the Internal Revenue Service (IRS), the AMT is a separately figured tax that eliminates many deductions and credits, thus increasing tax liability for an individual who would otherwise pay less tax.