AMT 'patched'; carried tax scuttled

By an 88-5 vote, the Senate late last night approved a bill that would prevent 19 million middle-class taxpayers from paying the alternative minimum tax this year. Facing unshakable Republican opposition, the Senate did not include a provision that was included in the House AMT bill approved last month that would cover the $51 billion cost of the AMT “patch” by raising taxes on private equity and hedge fund managers. House Ways and Means Committee Chairman Charles Rangel, D-N.Y., has agreed to drop the tax from the AMT bill, but he said he intends to bring the issue back up next year. “We will make adjustments to the bill to address some of the political opposition in the Senate as it relates to bringing equity into the tax code for managers of equity and hedge funds, but we will continue to pursue this issue,” Mr. Rangel said in a statement issued yesterday afternoon. “At this time we are looking to close a loophole where billions of dollars in offshore funds have escaped taxation,” Mr. Rangel said. “Closing this loophole has already been accepted by the House and it is my understanding that it will be received favorably in the Senate as well,” he said.