Bailout Bill Approved by Senate Raises AMT Threshold
The Senate has approved a $700 billion bailout bill for Wall Street that increases the threshold for the alternative minimum tax to protect an estimated 24 million families from an average tax increase of at least $2,000 each.
The provision is one of many tax breaks in the legislation, the Washington Post reports. Other measures give tax breaks for renewable energy, extend federal deductions for sales taxes in states that don’t impose an income tax, give homeowners who don’t itemize a $1,000 property tax deduction, and provide tax breaks to businesses.
Under the alternative minimum tax, individual taxpayers currently get an exemption of $33,750 and joint filers get a $45,000 exemption, according to a summary (PDF) of the tax provisions by the Senate Finance Committee. Personal credits are not currently exempt from the AMT. The Senate bill increases the exemptions to $46,200 for individuals and $69,950 for joint filers for 2008. The proposal also allows personal credits against the AMT.
The renewable energy provisions provide tax credits for solar installations for eight years, lift the $2,000 ceiling on the credit for residences, and extend the production tax credit for wind projects for a year, the Post reports in a separate story. Taxpayers would also get a credit of as much as $7,500 for electric or hybrid vehicles.
TaxProf Blog has other details of the bill, including a provision that would require broker reporting of customer basis in securities transactions.
