Sponsors (9)
The bill simplifies and lowers AMT burdens for many noncorporate taxpayers and streamlines some corporate credit computations, but it reduces corporate tax receipts and creates transitional compliance and cash‑flow risks for certain taxpayers and preparers.
Noncorporate taxpayers (individuals, trusts, estates, partnerships) get a clearer, lower two‑tier AMT rate structure (26% up to $175,000; 28% above), simplifying calculations and reducing uncertainty for many filers.
Corporations and small businesses benefit from being treated as having a tentative minimum tax of zero for general business credit calculations and removal of certain corporate AMT cross-references, which can increase usable credits and reduce duplicative compliance work.
Married taxpayers filing separately retain parity because their AMT thresholds are set at 50% of the joint amounts, preserving equitable filing treatment for separated filers.
Eliminating the corporate AMT effectively reduces taxes for some corporations, which could lower federal tax receipts and increase pressure on the deficit or shift more of the tax burden onto individuals.
Widespread changes to cross-references and removal of section 56A create compliance and transition complexity for taxpayers, tax preparers, and financial institutions for tax years beginning after 2024.
Some noncorporate taxpayers with large AMT preference items could face higher effective marginal rates under the new 26%/28% structure compared with prior rules, depending on exemptions and adjustments.
Based on analysis of 2 sections of legislative text.
Removes the corporate AMT by treating corporations as having a tentative minimum tax of zero and limits the tentative minimum tax rates to noncorporate taxpayers (26%/28%).
Introduced February 27, 2025 by John A. Barrasso · Last progress February 27, 2025
Repeals the corporate alternative minimum tax for tax years beginning after December 31, 2024, by treating corporations as having a tentative minimum tax of zero for purposes of the general business credit and related Code provisions. It narrows the alternative minimum tax so that a new tentative minimum tax with progressive rates (26% up to $175,000 and 28% above $175,000, with married-filing-separately thresholds at 50% of those amounts) applies only to noncorporate taxpayers while preserving existing AMTI adjustments and certain preference add-backs.