CQ TODAY MIDDAY UPDATE
June 27, 2007 – 1:51 p.m.
Baucus Seeking ‘Realistic’ Fixes for Alternative Minimum Tax

Another temporary patch to blunt the effect of the alternative minimum tax is a “given” this year, Senate Finance Chairman Max Baucus said today, signalling trouble for a House attempt to repeal the parallel tax system.

During a hearing, Baucus, D-Mont., asked witnesses for their best ideas to pay for the patch, which could cost $50 billion for one year and more than double that for two years.

“We’ve got to find ways that are realistic here, not that are unrealistic,” Baucus said. That caveat could preclude some of the ideas panelists put forward, such as curtailing the mortgage interest deduction, limiting the state and local tax deduction, and imposing a 4 percent surtax on adjusted gross income for couples earning more than $200,000 per year and individuals earning more than $100,000.

The AMT long has been a sore spot for tax experts. Congress first approved it in 1969 as a way to make sure that the wealthiest taxpayers couldn’t use legal deductions and credits to escape all tax liability. But the tax has never been indexed for inflation, which has steadily pushed its impact down the income ladder.

Source: CQ Today Midday Update
Political Clippings compiled from BNN Frontrunner and CQ Politics.com.
© 2007 Congressional Quarterly Inc. All Rights Reserved.