[Congressional Record Volume 153, Number 1 (Thursday, January 4, 2007)]
[Senate]
[Pages S73-S74]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. BAUCUS (for himself, Mr. Grassley, Mr. Schumer, Mr. Kyl,  
        and Mr. Crapo):
  S. 55. A bill to amend the Internal Revenue Code of 1986 to repeal 
the individual alternative minimum tax; to the Committee on Finance.
  Mr. BAUCUS. Mr. President, there is a monster in the tax code. Like 
Frankenstein, the Alternative Minimum Tax brings back to life higher 
taxes. Higher taxes that families had been told not to worry about are 
brought back because of the Alternative Minimum Tax, or AMT. It is a 
monster that really cannot be improved. It cannot be made to

[[Page S74]]

work right. It is time to draw the curtain on this monster.
  That is why I am pleased to join with my friend Chuck Grassley, and 
our fellow Committee colleagues, Senators Schumer, Kyl, and Crapo to 
introduce legislation today that will repeal the individual AMT. Our 
bill simply says that beginning January 1, 2007, individuals will owe 
zero dollars under the AMT. Further, our bill provides that individuals 
with AMT credits can continue to use those credits up to 90 percent of 
their regular tax liability.
  If we don't act, in 2007, the family-unfriendly AMT will hit middle-
income families earning $61,000 with three children. What was once 
meant to ensure that a handful of millionaires did not eliminate all 
taxes through excessive deductions is now meaning millions of working 
families, including thousands in my home State of Montana, are subject 
to a higher stealth tax. It is truly bizarre that we've designed a tax 
that deems more children ``excessive deductions'' and punishes duly 
paying your State taxes. Already, 5,000 Montana families pay a higher 
tax because of the AMT. But this number could multiply many times over 
if we don't act soon.
  Not only is the AMT unfair and poorly targeted, it is an awful mess 
to figure out. The National Taxpayer Advocate has singled out this item 
as causing the most complexity for individual taxpayers.
  Of course, repeal does not come without cost and that cost is 
significant even if we assume the 2001 and 2003 tax cuts aren't 
extended. We are committed to working together to identify reasonable 
offsets. Certainly, I don't think we want a tax system unfairly placing 
a higher tax burden on millions of middle-income families with 
children. But it doesn't serve those families either if our budget 
deficit is significantly worse.
  Like Frankenstein's monster, the AMT brings a most unpleasant 
reaction from those whom it encounters. It is time we end this drama 
and repeal the AMT.
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