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alternative minimum tax
noun
: a U.S. federal income tax that was originally imposed to prevent wealthy taxpayers from using tax shelters to avoid paying taxes, that excludes many deductions and exemptions allowed in computing regular tax liability, and that must be paid instead of the regular tax liability by individuals and businesses whose alternative minimum tax liability is greater than their regular tax liability
Examples of alternative minimum tax in a Sentence
Recent Examples on the Web
Some, for example, involve the calculation of the alternative minimum tax (AMT), a big concern for anyone with incentive stock options (ISOs).
—Bruce Brumberg, Forbes, 3 Dec. 2024
On top of that, airport revenue munis are subjected to the alternative minimum tax (AMT).
—Michelle Fox, CNBC, 25 Nov. 2024
Harris would raise the corporate tax rate from 21% to 28% and an alternative minimum tax for corporations from 15% to 21%.
—Louis Jacobson, Austin American-Statesman, 13 Oct. 2024
But all these possibilities have to be weighed against the fate of other provisions of the TCJA, which might reshape the deduction anyway (including the return of stricter rules for the alternative minimum tax).
—Joseph Thorndike, Forbes, 4 Nov. 2024
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Word History
First Known Use
1958, in the meaning defined above
Time Traveler
The first known use of alternative minimum tax was
in 1958
Dictionary Entries Near alternative minimum tax
Cite this Entry
“Alternative minimum tax.” Merriam-Webster.com Dictionary, Merriam-Webster, https://www.merriam-webster.com/dictionary/alternative%20minimum%20tax. Accessed 25 Dec. 2024.
Legal Definition
alternative minimum tax
noun
: a federal tax that prevents a person or entity (as a corporation) with taxable income from avoiding tax liability and that imposes tax liability in the amount of the excess of the tentative minimum tax over regular tax liability see also tax preference item
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