Megan Wheeler

Document Type

Honors Project

First Advisor

Dr. Arthur Gumenik

Degree Award Date

Spring 2008

Keywords

Alternative Minimum Tax, Middle Class Demographic, Analysis, costs and benefits, possible solutions

Disciplines

Business | Taxation

Abstract

The alternative minimum tax, or AMT as it is known, is a tax that took effect in 1970 in order to tax the wealthy families that were avoiding regular tax. Most recently, the AMT has caused a lot of controversy because it has been taxing more middle-class citizens and is trapping millions more each year. This research involves a very vital and current issue in our tax system, and I am planning to do an in-depth analysis of the AMT.

My honors project will take an in-depth look at the current alternative minimum tax, which is affecting millions of Americans. Aside from describing the history and of the tax, this honors project will address the calculations of the AMT. My honors project will examine the implications of this tax, as well as the costs and benefits of having such a tax imposed on taxpayers. It will address the reasons the government supports such a tax. Moreover, my honors project will address the issue of the alternative minimum tax on middle-class families. My main issue is how it is costing middle-class Americans more than wealthy families. Finally, my honors project will address several possible solutions to this problem, and will conclude with projections for the future of the alternative minimum tax and the best route to take in order to alleviate the problem on middle-class taxpayers.

In conclusion, the middle-class taxpayers suffer more than wealthy taxpayers for which the AMT was originally designed.

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