alternative minimum tax

noun

: 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

Garbarino said the group isn’t seeking a complete revocation of the cap, as was the case prior to Republicans’ 2017 tax law, due to the fact that the alternative minimum tax (AMT), which is a separate tax provision, kicks in at a level that makes an unlimited SALT deduction unnecessary. —Tobias Burns, The Hill, 7 May 2025

Rinehart also likes the premium in AMT bonds — those subject to the alternative minimum tax. —Michelle Fox, CNBC, 5 May 2025

Estimated tax is used to pay not only income tax, but other taxes such as self-employment tax and alternative minimum tax. —Nicholas Creel, MSNBC Newsweek, 18 Apr. 2025

The alternative minimum tax and a version of the SALT cap for corporations will also be important. —Emily Brooks, The Hill, 11 Jan. 2025

Word History

First Known Use

1958, in the meaning defined above

Rhymes for alternative minimum tax

• almanacs
• carrybacks
• haversacks
• lumberjacks
• maniacs
• microcracks
• minimax
• paperbacks
• parallax
• quarterbacks
• sticklebacks
• telefax

Legal Definition

alternative minimum tax

noun

: 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