If your income is in the $200,000-400,000 range, and you’ve been fretting over Barack Obama’s proposed tax hikes, relax; odds are decent you won’t wind up paying more. Obama’s plan does indeed jack up the rates on those tax brackets, but for many those increases won’t take their federal taxes above the Alternative Minimum Tax level they’ve been paying for years, the New York Times reports.
Those in the upper income echelons must calculate both their normal federal taxes, and their AMT, then pay whichever is higher. For the modestly wealthy, the AMT will likely remain higher, or extremely close. The tax hike will really hit those making much more. Especially hard hit will be the Wall Street honchos who’ve been paying the 15% capital gains tax on most of their income. They’ll now have to pay new 39.6% standard rate. (Read more Alternative Minimum Tax stories.)