One standout item from Trump’s 2005 tax return, revealed last night, was something called the “Alternative Minimum Tax” (AMT). If you’re not terribly familiar with it, here’s what the AMT is all about and why it matters.
The documents show Trump and his wife Melania paying $5.3 million in regular federal income tax—a rate of less than 4% However, the Trumps paid an additional $31 million in the “alternative minimum tax,” or AMT. Trump has previously called for the elimination of this tax.
It’s obviously not the only thing worth noting in this whole fiasco, but it brings to light the significance of the Alternative Minimum Tax, an important part of the IRS tax code.
The Alternative Minimum Tax was basically designed to keep wealthy people from taking advantage of so many loopholes that they don’t pay their fair share in taxes. As the Tax Policy Center explains, in 1968, Treasury Secretary Joseph W. Barr informed Congress that 155 taxpayers with incomes over $200,000 (which was an even more significant amount at the time)…