Alternative Minimum Tax (AMT)

AMT affects an increasing number of taxpayers, especially in high tax states like California. AMT provides for a separate calculation of income tax liability by adding back to income certain common deductions, called "preference items". Common items such as state and property taxes, medical expenses, certain interest on lines-of-credit, business related items, large capital gains and employee business expenses are common preference items that can throw a taxpayer into AMT.

It is difficult to determine which combination of factors will make you subject to the AMT. But it is best to estimate these before the end of the year, since normal year end planning will change if AMT is rearing its ugly head. Please contact us to assist in determining if AMT will affect you before it is too late.