Subject: Enrolled Agents claim nearly 1/3 of their 750 Clients are whipsawed by the AMT Comment: Dear Panel Members, please considered the following. Both my wife and I are “Enrolled Agents” and between us for the 2004 tax year will prepare about 750 returns. When I started doing taxes in the middle 60’s AMT had not even been enacted and did not impose a major burden on the average taxpayer until the 90’s. But today, to our continuing amazement, we now have over 250 clients into AMT and we haven’t even finished all the extensions for 2004. In case you missed the math—that is over 1/3 of our clients that are into AMT. Now –Please take notice: For our average client the AMT is generated primarily by, PROPERTY TAXES, AND STATE INCOME TAXES!!!! To make an even greater point, our clients have, in the past 5 years, have paid over $3 Million in AMT alone. ISO exercises only account for about 15% of the total. Note: on the average, that is over $4000 per family in EXTRA TAX due solely to AMT!! We think it is grossly unfair that taxpayers are required to pay the EXTRA AMT TAX on the unrealized gains in ISO exercises, but equally as ridiculous is making the taxpayers pay AMT on things like the property taxes, business expenses, and state income taxes!!!! With the property taxes and state income taxes – the taxpayers do not have an option whether or not to pay these! If you really want to collect more tax money from those in the stock market –Make the Broker Dealers report all the “Options” that are also sold in their 1099,s also! On this note- make it a requirement for all the companies to 1099 all the ISO exercises. We would guess that the majority of those people who do their own returns on Turbo Tax etc., do not report either the options or the ISOs! We think you are missing Billions of Dollars in taxes on these two issues. We need to reform the AMT rules and put them back to taxing those people for whom it was originally designed. John Wright EA 21470 Doris Lord EA 34125 408-247-7983 c/o Jerry White & Associates -CPA 2021 The Alameda #250 San Jose Ca. 95128 |