Subject: HELP!!!! Tax of $371k on a $10,000. gain- IRS forces Michigan Family of 4 to live on $322 a week! ISO-AMT Comment: Dear Tax Panel Memebrs, Below is our Families Testimony given to the House Ways & Means Oversight sub-Committee this past Summer your help & support is desperately needed. Statement from Mike Brown To House Ways and Means Committee, Subcommittee on Oversight Washington, D.C. June 2004 I am an average middle class American working in the high tech computer industry. For the last 7 years, I have worked for the same company, which granted incentive stock options to me as part of my compensation package when I first started. During the internet boom on the stock market, my stock options had a paper value of approximately $2 million. I never saw this money due to the dramatic rise and then crash of the stock market valuations. In the year 2000, I had income of $100,000. However, when my accountant calculated out what I owed due to AMT, the amount equaled $371,000...This is due to the over valuation of the stock during the year 2000 and not taking into account the dramatic fall of the stock. I was absolutely certain the accountant was wrong, because how could tax rates exceed my entire income! I checked with many attorneys, and tax accountants to find that, in fact, the accountant was correct and it was due to a little known tax called the Alternative Minimum Tax, which is basically an interest-free loan to the government that gets credited back to you over time.... So, I entered the paperwork that says I owe $371,000, however I did not have the money, nor do I have it today. In, fact that stock that was valued at $150 per share was now trading at $5 per share and my option price was $4.28 per share. So, my stock value that was left was less than $10,000. As you can see the AMT is not working the way it was intended. I conducted a lot of research into the tax, the history, and joined an organization that is made up of many other hardworking, honest taxpayers that this has affected. My wages are currently being garnished by the IRS and I’m only allowed to take home $332 per week for a family of 4. I am borrowing money weekly to stay afloat financially and going into more debt by the day...My life is being destroyed by a huge, unfair tax burden and since I am also raising 2 children, I am barely able to buy them groceries, let alone put money away for their college education. I have filed for an installment agreement with the IRS and that was denied. I have filed an appeal with the IRS and that was denied. I am currently looking for help in any fashion to pay the IRS a reasonable amount to move on and get on with my life. When the accountant did my taxes without AMT for 2000, the tax would have been $10,000 extra over what I paid thru the year. However, even when I offered to pay the IRS $1,000 every month for the next 7 years, ($84,000) they refused and continue to take my paychecks except the $332 per week they think I can live on...HELP!!!!! Mike Brown Manchester, Michigan |