acct401db2

acct401db2 - RE: The Alternative Minimum Tax The...

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RE: The Alternative Minimum Tax The alternative minimum tax is just as complex as normal taxes. This form of taxes is secondary to the normal tax calculations. Developed in the 1970’s to make sure everyone was paying taxes. It was created to insure that everyone pays taxes no matter how many deduction one takes. Higher-class workers can manage to get many tax breaks so that they would not have to pay a lot in taxes. Once the deductions and incentives are calculated many are in a lower tax bracket than they should be in. It is geared more towards the higher-class than any other class of workers. Inflation has caused many middle-class and lower-class to pay the AMT. This happens because the AMT is not variable it is fixed and is based on how the calculations are determined. AMT has a different tax structure to it. There are some deductions that are not permitted in the calculation and others that are permitted. One has to find out how much taxes are due by both methods and pay the higher of the two. The tax liability is different for both of the calculations.
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This note was uploaded on 07/19/2011 for the course ACCT 401 taught by Professor Hawkens during the Spring '11 term at Lee.

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acct401db2 - RE: The Alternative Minimum Tax The...

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