According to our tax guy, 2012 may be the first year that I'll be subject to the AMT. I researched it a little more and it looks like the exemptions for calculating the AMT are going to free fall from $74,450 for married people filing jointly in 2011 to $45,000 for married people filing jointly.
Is anyone else worried that Congress isn't going to patch the 2012 AMT? I've never really thought about it in the past.
Patching the AMT is a big battle cry for some people but it should only effect you in certain situations and if you earn a lot of money and have a lot of deductions. I think the biggest fear is that many more people will have to fill out the forms. I suspect that we will have to file AMT this year if there is no patch but I'm not actually that worried about it. The top marginal rate for the AMT is 28% so if you are already in a higher marginal bracket then it should not impact you much at all. If you are near the top of the 25% marginal bracket then that's when you are most likely to have to pay a little extra, especially if you pay high state taxes, mortgage interest, and so forth. Given that you live in California perhaps that's the case.
Is there anything else I should be doing to make sure I don't owe a bunch at the end of the year?
We really have a pathetic group in Congress right now. They seem to like this game of waiting until the end of the year and then "fixing" things right before Christmas. That is such a horrible thing to do to the country because it means no one knows what the rules are going to be until it is too late to do anything about it.
Things like a business tax credit for buying new equipment might be great for the economy. But if enacted on December 23, it completely loses any impact it could have because it is simply too late for any business to act on it.
So, short of setting aside extra money just in case you have to pay, there is not a whole lot you can do because NO ONE knows what is going to happen.
If I had to guess I would say that I think some things will get passed in September while there is still time for Congresslosers to tell their constituents what a wonderful job they've done before the election. But I would not wager so much as $1 on that because it could easily happen next week just so it's done and doesn't haunt anyone come election time, or late in December again, especially if there is a big change in control either way.