Both the width (or range) of the tax brackets (the amount of income taxed at a particular rate) in the tax
rate schedules and the range of the tax rates in the tax rate schedules (the difference between the lowest
tax rate and the highest tax rate) vary by filing status.
The tax rate schedules are set up to tax lower levels of income at higher tax rates than higher levels of
Tax rate schedules are provided for use by (relatively) higher income taxpayers while the tax tables are
provided for use by (relatively) lower income taxpayers.
If a married couple has one primary breadwinner, filing a joint return will likely result in a marriage
If both spouses of a married couple earn roughly equivalent wages, the couple is likely to pay a marriage
penalty due to the nature of the tax rate schedules.
A marriage penalty occurs when a couple pays more taxes by filing a joint tax return than they would
have paid had they filed married filing separate returns.
All capital gains are taxed at preferential rates.
Long-term capital gains, dividends, and taxable interest income are all taxed at preferential rates.
In certain circumstances a child with very little income may have their income taxed at the parents'
marginal tax rate.
10. The kiddie tax does not apply to children over 24 years old at the end of the tax year.
11. The alternative minimum tax system requires taxpayers to apply an alternative tax rate on the regular
income tax base to determine the amount of the alternative minimum tax.
12. Regular taxable income is the starting point for determining the alternative minimum tax.
13. The alternative minimum tax is the AMT base multiplied by the AMT rate.
14. Long-term capital gains are taxed at the stated AMT rate for purposes of the alternative minimum tax.
15. Taxpayers are not allowed to deduct personal or dependency exemptions for alternative minimum tax
16. For alternative minimum tax purposes, taxpayers are required to add back the regular tax standard
deduction amount for their filing status whether or not they itemized deductions for regular tax
17. For alternative minimum tax purposes, taxpayers are allowed to deduct state income taxes but are not
allowed to deduct charitable contributions.
18. The AMT exemption amount is phased-out for high income taxpayers.
19. All else equal, a reduction in regular income tax rates would require more taxpayers to pay the alternative
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