alternative minimum tax

noun

Definition of alternative minimum tax

: a U.S. federal income tax that was originally imposed to prevent wealthy taxpayers from using tax shelters to avoid paying taxes, that excludes many deductions and exemptions allowed in computing regular tax liability, and that must be paid instead of the regular tax liability by individuals and businesses whose alternative minimum tax liability is greater than their regular tax liability

Examples of alternative minimum tax in a Sentence

Recent Examples on the Web Lawmakers should look instead at companies that aren’t paying much in taxes now and consider ideas such as a corporate alternative minimum tax, said Hana Greenberg, vice president of tax at the Retail Industry Leaders Association. Richard Rubin, WSJ, 7 Oct. 2021 Republicans created the cap in 2017 to help pay for tax cuts for individuals, including lower rates, larger child tax credits for individuals and the narrowing of the alternative minimum tax that hit higher-income households in those same states. Kate Davidson, WSJ, 17 June 2021 Don’t forget to consider the effects of the alternative minimum tax when planning how much to give. Bob Carlson, Forbes, 26 June 2021 Doing so could push your other income into a higher bracket, trigger the alternative minimum tax, cause more Social Security benefits to be included in gross income, increase the Medicare premium surtax, or cause other changes. Bob Carlson, Forbes, 23 June 2021 President Biden wants to impose a form of alternative minimum tax on corporate profits earned overseas, with a statutory rate of 21% and an effective rate that’s higher for many companies. The Editorial Board, WSJ, 19 May 2021 Upper-middle-income taxpayers who did itemize lost much of the benefit to the alternative minimum tax, from which SALT isn’t deducted. Tomas J. Philipson, WSJ, 27 Apr. 2021 Importantly for many upper-middle-class Californians, the alternative minimum tax was significantly lowered. George Skelton, Los Angeles Times, 15 Apr. 2021 Other ideas, however, such as an alternative minimum tax or tax relief programs for certain industries could find bipartisan support, according to John Gimigliano, principal-in-charge of KPMG’s U.S. tax legislative and regulatory services business. Nina Trentmann And Mark Maurer, WSJ, 10 Nov. 2020

These example sentences are selected automatically from various online news sources to reflect current usage of the word 'alternative minimum tax.' Views expressed in the examples do not represent the opinion of Merriam-Webster or its editors. Send us feedback.

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First Known Use of alternative minimum tax

1958, in the meaning defined above

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The first known use of alternative minimum tax was in 1958

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Last Updated

16 Oct 2021

Cite this Entry

“Alternative minimum tax.” Merriam-Webster.com Dictionary, Merriam-Webster, https://www.merriam-webster.com/dictionary/alternative%20minimum%20tax. Accessed 26 Oct. 2021.

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More Definitions for alternative minimum tax

alternative minimum tax

noun

Legal Definition of alternative minimum tax

: a federal tax that prevents a person or entity (as a corporation) with taxable income from avoiding tax liability and that imposes tax liability in the amount of the excess of the tentative minimum tax over regular tax liability — see also tax preference item

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