Message to Congress: AMT Should Not Tax Fire Fighters

March 23, 2007 – Michael Day, president of Baltimore County, MD Local 1311, testified before the U.S. House of Representatives Ways and Means Committee March 22 that the Alternative Minimum Tax (AMT) could hit fire fighters hard with a tax increase next year if Congress fails to protect them from it.

The AMT was created in the 1960s to prohibit wealthy taxpayers from avoiding federal taxes by using tax shelters and excessive deductions. Since then, however, “the AMT has unintentionally evolved from a tax on the wealthiest few to invade middle-class households living paycheck to paycheck, making checkbooks all across this country that much harder to balance every month,” Day told the tax-writing committee. “The AMT has transformed into a tax on the very people it sought to protect.”

Day noted that fire fighters are especially vulnerable to the AMT because they exemplify the people most at risk of increased taxes under the AMT: middle-income taxpayers living in high tax states with mortgages and dependents. He also noted, “Fire fighters in many other jurisdictions get incentive pay for additional fire and homeland security training and education. So, the more skills we develop to better protect our community, the more susceptible we are to AMT.” Day added that the AMT “makes living on a modest fire fighter’s salary that much harder.”

For the last several years, in response to this growing problem, Congress has passed annual patches, oftentimes at the last minute, to protect middle-class taxpayers from the AMT. The Ways and Means Committee is expected to propose legislation that will protect fire fighters and other middle-class families from the AMT by the end of next month.

President Day urged the Committee to “permanently fix” this problem so that fire fighters and other middle-class families aren’t “thrown back into its path a year later.”

To read Day’s full testimony click here.