The alternative minimum tax was created in 1969 to ensure that high-income taxpayers did not exploit tax laws to reduce or eliminate their federal income tax. By 2010, it is expected to affect 36 million taxpayers, particularly upper-middle-class families with children. This slide show provides an overview and history of the tax; Tax Policy Center projections; an examination of equity, efficiency, and complexity issues; and reform options. The show is based on the discussion paper "The Individual AMT: Problems and Potential Solutions."

These facts and projections highlight the increasing role of the AMT, and the problems it poses. The facts are based on the discussion paper "The Individual AMT: Problems and Potential Solutions." The Tax Reform Act of 1969 created a minimum tax designed to ensure that individuals with high incomes did not take what was deemed undue advantage of tax laws to avoid federal income tax liability. The individual AMT is now on the verge of switching from a "class" tax to a "mass" tax. The trends are troubling because the AMT is notoriously complex, its effects on efficiency and equity are questionable, and its underlying purpose is controversial.

The descendant of a 1969 tax designed to prevent 155 wealthy people from escaping federal tax liability will affect 36 million, mostly middle-class taxpayers by 2010, say researchers from the nonpartisan Tax Policy Center, a joint venture of the Urban Institute and the Brookings Institution. [Read the <a href="http://taxpolicycenter.org/research/Topic.cfm?PubID=410561" title="Click to read the report online ..." class="smaller">report</a> and the companion <a href="http://taxpolicycenter.org/research/Topic.cfm?PubID=310565" title="Click to read this report online ..." class="smaller">policy brief</a>]