That’s how many more American households will have to pay the alternative minimum tax if the president and Congress can’t reach a deal.
The AMT, a parallel tax structure originally designed to prevent high-income households from legally escaping the income tax, will affect only about 4 million households in tax year 2012 if lawmakers can pass a fix. Those folks would pay even more without a solution.
Even the pared-down proposals for solving only the “must-do-now” pieces of the so-called fiscal cliff include an AMT patch.
Yet, if lawmakers fail to act even on the pared-down plans, the AMT would raise taxes on much of the middle class in the returns they’ll file in early 2013. The AMT tends to affect residents of high-tax states because it prevents taxpayers from deducting state and local taxes. For instance, without the patch, about half of New Jersey households would pay taxes under the AMT for 2012.
Richard Rubin contributed.