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That's a worst case situation. Our income was more than twice that last year, and AMT had no impact. Unless you have a lot of capital gains and other tax advantaged income, a married couple is unlikely to be subject to AMT until they have well over $1 million in income. In addition, the exemption for calculating AMT is far higher, $126,000 for a married couple.
Very few regular folks with W-2 or 1099 contracting income are subject to AMT.
Wow. That's just not true at all.
Quote:
"This means that for a single person who earned more than $75,900 in 2022, but less than $206,100, the AMT rate is 26 percent. If that person earned more than $206,100, the AMT tax rate goes up to 28 percent."
If you insist on selling at a loss because you don't increase your prices when the tax you pay increases, you'll go bankrupt.
If I am selling at a loss, then I am not paying taxes on the loss. My example was a case where I could not maintain my net profit when tax rates were increased. I still make a net profit, but it's smaller than before the tax increase. And, some larger oil companies will sell at a loss for some period of time because the costs to restart production are higher than the losses.
If I am selling at a loss, then I am not paying taxes on the loss. My example was a case where I could not maintain my net profit when tax rates were increased. I still make a net profit, but it's smaller than before the tax increase. And, some larger oil companies will sell at a loss for some period of time because the costs to restart production are higher than the losses.
I'm talking about cases in which the profit margin is so thin that a tax increase means a corp sells at a loss if they don't raise their prices. They then go bankrupt.
For example, Oil & Gas Refining & Marketing had an average 0.2% net profit margin as of April 2024. If their taxes increase and they don't raise their prices, they sell at a loss and get dangerously close to bankruptcy.
Interesting chart shows exactly which industries are price gouging, which are barely making it, and which are losing money:
And are you suggesting that a working couple (filing jointly) earning $200,000 would be in a higher marginal tax bracket than the AMT? If so, you'd be wrong. Their 2024 marginal tax rate is lower at 22% instead of the 26% AMT rate.
No, what I'm saying is that regular tax exceeds the tentative minimum tax under the AMT calculation. Which is obvious considering that the standard deduction is only $29200. So no AMT tax is due. Got it?
No, what I'm saying is that regular tax exceeds the tentative minimum tax under the AMT calculation. Which is obvious considering that the standard deduction is only $29200. So no AMT tax is due. Got it?
Since when is a 22% tax rate higher than a 26% tax rate?
Additionally, the Alternative Minimum Tax exemption amount for tax year 2024 is $85,700 for singles and $133,300 for married couples filing jointly.
The taxes paid by corporations do come from the corporate revenues. However, the argument that corporations will simply adjust their prices to cover higher tax rates is just not true. If I am an oil producer, the price I receive is whatever the market price for oil is, based on quality. If taxes go up, I cannot charge more for my oil, as no one will pay the increased price. That means the taxes reduce my net profits. If the price of oil remains at $80 per barrel and my marginal tax rate goes from 21% to 28%, I will still get only $80 for my oil and will have reduced net profit after taxes. This applies to any product that is subject to global competition.
We are living it my friend. Look at prices around you...it's more than just "inflation"...it's also the huge increase in wages for workers driving prices higher.
That doesn’t make it right. It should’t affect anybody. So sick and tired of successful people being villainized and victimized. It’s a bad look.
Hard work and achievement are penalized in the US. The Fed Gov would prefer that NO ONE prospers.
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