Subject: Alternative Minimum Tax Comment: Floyd and Robbin Rekemeyer Statement to the President's Advisory Panel on Federal Tax Reform Dear Panel Members: The Alternative Minimum Tax Law currently requires citizens to pay huge amounts of taxes on imagined gain that the taxpayer may never realize. When my husband and I exercised stock options through his employer as a portion of our retirement fund in 2000, we did not know about the Alternative Minimum Tax. There was a large difference between what we paid for the stock and the stock’s value at the time of exercising. Unfortunately, as complicated as the law is, it does not account for the possibility that stock might decline substantially before the taxpayer could sell it, so we had to pay over $40,000 in Alternative Minimum Tax on stock that has a current value of under $1000. We paid half our entire income for one year! We, in effect, prepaid taxes on income we never received to generate credits we may never receive. This tax on phantom income is unjust and must be reformed. Thank you for your help. Floyd and Robbin Rekemeyer Cedar Rapids, IA |