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Congressman Adrian Smith (R-NE), a member of the House Budget Committee, today praised Congress’ action to ensure as many as 25 million Americans will not see a massive tax hike caused by the Alternative Minimum Tax (AMT).

“This was an issue which should never have been delayed this long, threatening millions of Americans with the AMT. The short-sightedness of the AMT should not continue to be a burden on U.S. taxpayers. With this vote today, Congress helped stave off an impending financial tidal wave,” Smith said.

In 1969, Congress adopted the AMT to ensure wealthy individuals could not avoid income taxes. At the time, this seemed like the perfect solution. However, while regular income tax rates are indexed for inflation, the AMT is not. According to the Tax Policy Center, the average AMT taxpayer owed more than $6,000 in additional tax in 2006.

As income levels have increased over time, the AMT has become a huge burden on our nation’s middle class.

Agriculture producers pay a disproportionate amount of their income in AMT because they lose the ability to deduct some of their state and local taxes, some farm and ranch operating losses, and because they tend to have more capital gains tax income than other taxpayers.