Millions of taxpayers would see their filing season upended unless Congress enacts a legislative fix to the Alternative Minimum Tax by the end of the year.
But if the patch does not happen; an extra 28 million households would get hit with the AMT, an alternative system that is supposed to take aim at wealthy taxpayers legally avoiding taxes. The last legislative fix expired at the end of 2011, making the AMT one of the more immediate threats in the looming “fiscal cliff.”
More than 60 million taxpayers might not be able to file a return or receive a refund until March 2013 or beyond if the AMT isn’t patched, as the IRS would be forced to scramble to reprogram its processing systems. Tens of millions of these taxpayers would unexpectedly have to pay additional income tax for 2012, leaving them with a balance due return or a much smaller refund than expected, and for millions of other taxpayers, refunds would be delayed. The millions of taxpayers who would face the AMT if it wasn’t patched would pay an average of $3,700, according to the Tax Policy Center.
December 3, 2012 12:00 am