2007 Tax Law Changes

Alternative minimum tax exemption rises for 2007

This helps taxpayers who might have too many deductions. But unless Congress acts, the exemptions could fall in 2008, raising taxes for thousands of taxpayers.

Late in 2007, Congress did families a favor and expanded the exemptions on the alternative minimum tax for the 2007 tax year.

The AMT is a parallel tax system that can take away some breaks and potentially saddle taxpayers with huge bills.

To reduce the number of taxpayers getting hit by the tax, Congress has expanded the income levels under which the tax cannot be applied.

For 2007, the AMT exemption will rise to:

  • Married couples filing jointly: $66,250 ($33,125 for married couples filing separately). That's up from $62,550 in 2006 -- or $31,275 for married couples filing separately.

  • Singles and heads of households: $44,350. That's up from $42,500 in 2006.

What happens in 2008? That depends again on Congress.

Unless Congress acts, the tax could hit 23 million taxpayers because the exemptions listed above will fall.

Here are the numbers:

  • Married couples filing jointly: $45,000 ($22,500 for married couples filing separately).

  • Singles and heads of households: $33,750.

Rate this Article

Click on one of the stars below to rate this article from 1 (lowest) to 5 (highest). LowRate it 1Rate it 2Rate it 3Rate it 4Rate it 5High