My AMT burden cost me $250,000 in savings 6/26/05
Speaker Hastert:
I am writing for myself and others in a similar position that have suffered financial hardships as a result of the Alternative Minimum Tax.
I work for a small technology-consulting firm that provided incentive stock options as part of its compensation. Believing in the company and its future and being hamstrung by rules that dictated when I had to exercise and when I could sell, I exercised and held good portions of the stock granted to me as ISOs. However, the antiquated and complex rules of the AMT, as I understand were created to ensnare the wealthiest individuals in the US from sheltering gains from the government, have now caught unaware many middle and upper middle class Americans who have worked hard for what they have earned. Since the AMT requires the gains to be calculated at the time of exercise not at the time of sale, I owed nearly $250,000 in taxes based on paper profits not on actual gains.
Calculating tax on paper gains is wrong and unfair. While I did not suffer as badly as others, at the time the $250,000 was 200% more than my annual income.
While I continue to work for the same company today and I continue to hold its stock, I am very disenfranchised with the tax policy and urge you to please take a stand and retroactively eliminate the AMT. Demonstrate to the people that you represent, that you believe the government should not continue to support unfair tax policies and now tax policies that discourage individuals from joining and supporting the success of small businesses.
Thank you for your time and consideration.
Sincerely,
Daniel T. Toth
IL. 14 th
Congressional District