AMT Deals Flying

Alternative Minimum Tax deals are flying, as Congress tries to find a way to prevent the tax from hitting millions of middle-income Americas, while still making it home in time for Christmas dinner in the district.

House Ways and Means Committee Chairman Charles B. Rangel (D-NY) introduced a new version of his AMT relief bill today – one missing some of the pesky pay-fors overwhelmingly opposed by the Senate. The new bill leaves out the carried interest tax increase, a controversial tax hike that over doubles the tax rate paid by hedge fund, private equity, real estate partnership, and venture capital executives on a portion of their income. 

Rangel also dumped 2-year extensions of other expiring tax provisions popular with the business community. 

“Senate Republicans have defined themselves as an obstacle to providing responsible AMT relief, suggesting that provisions in previous legislation were too controversial to pass Congress this year,” Rangel said.

Rangel’s new bill funds the roughly $50 billion, 1-year AMT patch with a host of other, less-controversial tax increases. Hedge fund managers still get hit, with new taxes levied on portions of their compensation deferred in off-shore accounts.