AMT Impact

Floor Speech

AMT IMPACT -- (Senate - March 05, 2008)

Mr. McCONNELL. Mr. President, last week our friends on the other side pulled the housing bill. But the problem the bill was meant to address obviously does not go away. The effects of the housing downturn continue to spread.

Yesterday the Fed Chairman called for a vigorous response from banks and from lenders. He said aggressive action by lenders would help stressed homeowners and help ensure the health and well being of the broader U.S. economy.

Well, we Republicans have been saying the same thing about Congress's response to the housing crisis for 2 weeks. The Democratic plan for stressed homeowners is to raise monthly mortgage payments on those who buy new homes or refinance existing ones. We have a different view on this side of the aisle. We want to expand the family budget, not the Federal budget, by helping homeowners with targeted assistance and homebuyer tax credits that will make the problem better, not worse. We have a concrete plan to foster the conditions that lead to more homeownership by protecting existing jobs, creating new jobs, increasing wages and keeping taxes low.

Among the things we can do to keep taxes low is to patch the loophole that threatens tens of millions of middle-class Americans with a giant AMT tax this year. There is no reason we cannot come together now and remove any doubt Americans have about paying a tax that threatens to cost them, on average, $2,000 more in taxes this year.

We patch the AMT every year, and because it was never meant to hit middle-class taxpayers in the first place, we patch it without creating new taxes somewhere else. In the current economy, we should spare taxpayers the political theatre of waiting until the last minute to go through this annual charade.

Last night the Budget Chairman said the Democratic budget proposal this year will include an AMT patch without an accompanying tax hike. I think that is certainly good news. I commend him for that decision, and it is one more reason we should not put off passing the AMT fix. If this is what the chairman intends, we should follow through on it now to give taxpayers added certainty. We should remove the doubt about the AMT now so Americans who are worried about the economy have one less thing to be concerned about.

Last year a Democratic-led standoff over passing an AMT patch threatened to delay tax returns for 50 million taxpayers, totaling about $75 billion in refunds. In this economy, we cannot afford to play these kinds of games. We know we will patch the AMT at some point this year. We should give some comfort to taxpayers by doing it now. It is time to put American families' budgets in front of the ever-expanding Federal budget.

Mr. President, I share the view of the majority leader that we are making good progress on the underlying bill, and hopefully that will continue today.

I yield the floor.

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