October 16,2007

Grassley, McCrery Seek Treasury Response on Taxpayer Impact of Delayed AMT Relief

WASHINGTON – Sen. Chuck Grassley, ranking member of the Committee on Finance, and Rep. Jim McCrery, ranking member of the Committee on Ways and Means, today asked the Treasury secretary for a detailed analysis of the impact on taxpayers of the Democratic-led Congress’ failure to extend Alternative Minimum Tax (AMT) relief so far this year.

Grassley and McCrery, the two senior-most Republicans on the House and Senate committees with jurisdiction over taxes, are concerned that the delay will cause hardship and confusion for millions of families that already are forced to perform AMT calculations for their households, a headache in itself. They also fear that the delay will cause overpayment of taxes, underpayment of taxes, filing errors, and wasted tax dollars on revised IRS forms and guidance.

“At this time last year, Congress was stalled on extending some tax provisions, like the college tuition deduction and teachers’ deduction of classroom expenses,” Grassley said. “That caused problems for taxpayers. This time, many more taxpayers are involved. Last year’s problems will look puny in comparison. The Democratic leaders need to get off the dime and enact AMT relief sooner rather than later.”

McCrery said, “"I believe that the problems created by the AMT are so large that they must be addressed as a part of a comprehensive reform of our tax laws. It seems less and less likely that sort of comprehensive reform will happen this year. Given that, the responsible course of action is to extend the AMT ‘patch’ -- as Republicans have done for years -- so that 19 million taxpayers are protected from the increased bite of the AMT. Failing to ‘patch’ the AMT in a timely manner will have serious consequences. Lawmakers and taxpayers should be aware of them.”

As chairman of the Committee on Finance from January 2001 to May 2001 and again from January 2003 through January 2007, Grassley shepherded through legislation to greatly limit the number of new taxpayers who fell into the AMT.