Igloo - whether someone in that income bracket pays AMT or not really depends on individual circumstances. A person with income much lower than that can be hit with AMT - if there are ISOs exercised but not sold in that year. What @swimcatsmom said. But the part about adding property tax back is correct. Not the part about income level that triggers AMT.
Bus - I just checked the K county records… new property valuations for 2018 have been posted, but not the tax due. Can’t pay until that shows up!
@BunsenBurner That doesn’t dispute the general zest of my statement. Yes, there are special circumstances but AMT hits many people, vast majority of population in many different income group. In other words, property tax deduction is a moot point for many. I don’t see why people jump up and down on that. You were likely not to have gotten deductions on property or state/local income taxes well before yesterday anyway. It’s mainly the very well-to-do that get hurt from eliminating deduction on property tax. I thought we were all for taxing the rich. Sorry @ClassicRockerDad. But you can afford it 
No, that is not what you said. Here is the statement:
" Everyone between $130K and $900K are paying AMT and gets no deduction on property or local taxes."
Meaning:
(A) Everyone between $130K and $900K are paying AMT, and
(B) Folks in (A) get no deduction on property or local taxes.
(A) is simply incorrect, making the entire statement incorrect.
Ok, I will edit, not everyone, many in that income level. Happy now?
That is also not true.
I don’t know why you say it’s not true.
“The individual alternative minimum tax (AMT) primarily affects well-off households, but not those with the very highest incomes. It is also more likely to hit taxpayers with large families, those who are married, and those who live in high-tax states.”
In other words, people who would likely to lose deductions under the new law. They were already losing it because of AMT. For many it’s a wash.
Our income is between that which Igloo cited and we’ve never paid the AMT. only were a family of 3 but we do live in what is probably the highest taxed state in the country.
In that case, you will be affected by the new law. In your case, you have a reason to be annoyed by the elimination of property and local tax deductions. The figure I came up with, $130K-$900K is a rough guesstimate from playing around with my set of deductions, not to be taken literally.
About tuition, my D is also a grad student with tuition waiver. How do other grad students who don’t get tuition waiver pay their tuition? Is it tax exempt? On the portion of their income paying the tuition, do they have to pay tax? If they do pay tax, it’s only fair tuition waiver is included in taxable income. If not, it’s not fair.
Of course my taxes will be higher under this tax cut plan. I’m not delusional that it will benefit us in any way, shape or form. This is a tax cut for the extremely wealthy and corporations, no one else.
We make more than what Igloo states as minimum and the only time we came close to AMT was when I screwed up and doubled what we’d paid in sales tax one year (remodel + new car). Deductions often trigger.
More of my earned income will go towards subsidizing “taker states”. Fun times.
Given the cost of housing in my area, my daughters will never buy if the max for mortgage deductions is $500K. Again, benefits the middle of the country. I’m getting more than a little angry at people in my state being considered “less than” unless it means that we can keep paying for other states to pay less.
One thing that I was wondering if they were going to sneak in…taxing employer provided health benefits. They already put it on your W-4 statement, I figured that was so it would be easy to tax it when they felt the moment was right. I never bought the explanation that it was just so we knew what it cost.
@busdriver11 - they put that cost there because of the ACA - and the Cadillac Tax that was supposed to kick in, but was deferred until 2020
Wow. Both of my daughters are PhD students getting tuition waivers and a stipend. That’s going to add about $6000 to their tax bills, which is really bad since they only make around $30K. Not sure how that’s going to play out with research budgets and stipends. D1 just applied for an NSF fellowship. I wonder if they are going to tax fellowships. D2 couldn’t even take a fellowship since she isn’t 24 until 2019 and would be subject to the kiddie tax which is even worse be cause it all gets taxed at my 35%.
It must be great to be one of the Koch and friends Republican donors. It sure sucks to be the rest of us.
@ucbalumnus my response was to igloo who intimated that you don’t deduct property taxes. Yes you may have to add it back in to figure out your AMT but you still get to deduct it.
My line item 40 Itemized deductions which included property taxes matches my total on schedule A.
The AMT comes into play when they figured I still didn’t pay enough. I say the whole thing is a farce because our income was not that high, we were only claiming two kids and all our our income is w-2.
Graduate students with tuition waivers are largely funded PhD students.
Other graduate students, generally meaning professional school students (MD, JD, MBA, etc.) pay tuition, unless reduced by scholarship.
Whether a waiver or scholarship should be considered taxable income depends on whether you see it as income that is then required to be used to pay for tuition (being taxed along the way), or a discount offered on the tuition (for most things, when someone offers you a discount, the amount of the discount is not normally taxable income to you when you buy whatever).
@Iglooo you don’t lose deductions because of AMT you just pay extra taxes. Also it’s not a wash because we were losing it anyway. My SALT in 2015 year was 19888 so that’s a big loss. My property taxes were quite reasonable.
Parents or loans.
No, we don’t pay taxes on either of those.
if I read the news correctly, its only tuition waivers given to students on behalf of that student performing as a TA or research-ship that would be taxable.
I assume, therefore, that merit scholarships, like those offered in professional schools, are still tax free. Thus, a (wealthy?) Uni could offer a PhD student a ‘merit scholarship’ covering say, 8 semesters of tuition, making it tax free. Thus, the Uni could mandate a course, called Teaching 101 in which a grad student must complete as part of their eduction, and which would also recieve course credit, say 2 units pass/fail. For that course credit in Teaching 101, said grad student would have to run course lab/discussion sections, meet with students to provide comments on papers, etc.
Just an idea for a workaround for PhD students. For those students in terminal MA programs, perhaps not so easy to avoid the tax.
The fact that they are taxing all sorts of higher education benefits just burns me up. I think a lot of folks are going to be shocked if many of these provisions are passed. I know CC is a very engaged group but folks are in for a rude awakening.