The Basics A big, ugly tax surprise is looming

The alternative minimum tax is snaring more Americans every year, and unless Congress fixes it, tens of millions will pay higher income taxes in the next few years -- maybe even you.

f you haven't been hit by the alternative minimum tax, this is no time to relax. It's getting closer and closer to you. And you might get hit by the tax sooner than you think -- unless Congress fixes it.
The AMT is victimizing about 3.5 million households for the 2006 tax year, 57% of which had incomes of $200,000 to $500,000. The Tax Policy Center estimates the result was an average increase in taxes for each household of $4,599.
For the 2007 tax year, the increase is expected to grow to $6,782, with about 19 million families getting drawn in. About 64% of those taxpayers will have earnings of $100,000 to $200,000.
Without a long-term fix, the AMT likely will reach nearly 30 million more taxpayers and grow from $28 billion in fiscal 2008 to $140 billion in 2012. By 2010, the AMT is projected to hit half of taxpayers earning between $75,000 and $100,000.
And all those people weren't even supposed to pay it.
The AMT is a tax computation different from your normal tax puzzle. It was designed in the late 1960s and enacted in 1970 to ensure all taxpayers paid something. The problem is that the tax is not indexed to inflation, and, as a result, growing numbers of middle-income