In December, Congress passed a one-year “patch” to the Alternative Minimum Tax (AMT). The patch will save nearly 23 million taxpayers about $2,000 in taxes. Most of these savings will go to those earning $172,000 to $455,000, although those earning $84,000 to $121,000 will save an average of $,1425. So what’s the problem?
Congress acted too late. The IRS has a November deadline for printing instruction booklets and programming its computers for the upcoming tax season. Congress blew by this deadline, and now the IRS is frantically working to reprogram its computers to account for the last minute patch. While most tax payers will not be affected, the IRS has announced that as many as 13.5 million tax payers who use five specific forms related to the AMT legislation will have to wait to file their tax returns. Returns that include the following forms cannot be filed until February 11, 2008:
- Form 8863, Education Credits
- Form 5695, Residential Energy Credits
- Schedule 2, Form 1040A, Child and Dependent Care Expenses for Form 1040A Filers
- Form 8396, Mortgage Interest Credit
- Form 8859, District of Columbia First-Time Homebuyer Credit
If you’re curious whether you may owe AMT, the IRS does make available an AMT Assistant calculator on its website. The 2007 AMT Assistant is not yet available, but you can check out the 2006 AMT Assistant here.