Delayed AMT 'patch' to stall refunds

The alternative minimum tax patch will delay refunds for several million taxpayers, according to the Internal Revenue Service. Up to 13.5 million taxpayers won’t be able to file their AMT-related returns until Feb. 11. However, historically only 3 million to 4 million people file that early, the IRS said. The Feb. 11 date will permit the IRS sufficient time to update and test its systems to take the AMT changes into account. It will take about seven weeks from the approval of the patch to update the systems altogether. The patch was intended to fix an error in the AMT, which was enacted in 1969 to ensure that the very wealthy did not claim excessive deductions. Since the AMT hasn’t been adjusted for inflation, many middle and upper middle class people are subject to it. Last Thursday, Congress passed the AMT patch as the House of Representatives voted for the measure 352-69. Squabbling between Republicans and Democrats over raising taxes to cover the $53 billion bill led to delays in passing and implementing the patch. “We regret the inconvenience the delay will mean for millions of early tax filers, especially those expecting a refund,” said Linda Stiff, acting IRS commissioner, in a statement. “We’ve taken extraordinary steps to figure out a way that we can start the filing season on time for most taxpayers, including some using AMT related forms.”