The proposal to revive the corporate alternative minimum tax, that the Tax Cuts & Jobs Act repealed, is now oriented for corporations with at least $1 billion in profits (as reported to shareholders). These corporations would need to pay at least a 15 percent minimum tax on those profits. If enacted, the tax would be effective in tax years beginning after 2022. The tax would apply to corporate taxpayers (but not to S corporations, RICs or REITs) that satisfy certain annual minimum income requirements over a three-year period. Income of controlled foreign corporations and non-consolidated entities would also be included—and any deductions for U.S. or foreign income taxes would be removed in calculating income. It’s estimated that this tax would apply to about 200 corporations and raise hundreds of billions of dollars in revenue.
Like many taxes that start as a thin edge of the wedge, this one may expand to include more taxpayers and at a higher rate, over time.
For more information on the current corporate income tax structure, visit Tax Facts Online. Read More
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