minimum tax


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Alternative Minimum Tax

A tax in the United States intended to be levied on very wealthy persons who are eligible for so many deductions that they would otherwise have little or no tax liability. To arrive at the AMT, one adds certain deductions back into a person's adjusted gross income and then subtracts the AMT exemption, which results in the alternative minimum tax income. The taxpayer then pays a percentage of the alternative minimum tax income rather than his/her AGI. The AMT is controversial in the United States because it is not indexed to inflation, meaning that upper middle class families are gradually becoming subject to it, rather than only the very wealthy. See also: Tentative minimum tax, Bracket creep.

minimum tax

References in periodicals archive ?
Although the overall theme for 1989's tax legislation was to raise revenue, Congress adopted some costly benefits for corporations which simplify the ACE calculation as originally enacted and modify the AMT system by liberalizing the minimum tax credit (MTC) computation.
The Coalition for Tax Fairness (CTF) is a non-partisan, non-profit organization that is supporting a legislative initiative to fix the current Incentive Stock Option Alternative Minimum Tax (ISO AMT) crisis.
In this regard, the 1989 Act not only simplified the alternative minimum tax provisions of the Code and repealed the mind-numbingly complex anti-discrimination rules of section 89, but also reformed and simplified the Code's penalty provisions.
Islamic banks in Pakistan have raised concerns about government proposals to charge them a minimum tax.
The AMT replaced its predecessor 6the minimum tax 6 ten years after it was brought in 1969 by the congress.
He said minimum tax and alternate corporate tax paid or adjusted by different telecom companies for the Tax Year 2015 include Income Tax (Minimum Tax): Rs.
If they have adjustments and preference items that cancel each other out (Scenario 1), the tax base for AMT purposes is also $240,000 and their tentative minimum tax is $63,492 (28% X ($240,000 - $185,400) + 26% X $185,400).
2) Supporters of IP 28 also argue that Oregon corporations can escape paying state taxes due to the fact that the Oregon Business Energy Tax Credits can offset the Oregon minimum tax.
The credit can be used to offset tax, including reducing the tax below tentative minimum tax.
According to the first option, the aggrieved corporate service sector would be allowed to opt out of the minimum tax regime, provided the said aggrieved corporate service sectors offer themselves for audit by an irrevocable undertaking in writing in advance by October 15, 2015 or the date decided by the government for the tax year 2016.
For example, if a taxpayer has regular income tax of $100,000 and no alternative minimum tax and other allowable credits, the general business credit cannot exceed $81,250 ($100,000-$18,750 [($100,000-$25,000) x 25%]) (assuming $81,250 is greater than the taxpayer's tentative minimum tax).
However all the exemptions under Section-53 Second Schedule were withdrawn and companies were also made liable to pay a minimum tax under Clause-113 of the Ordinance.

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