Alternative Minimum Tax (AMT)
An additional tax imposed on individuals, corporations, trusts and estates if the amount of tax liability determined under the alternative minimum tax rules exceeds the tax liability determined under regular income tax rules. The alternative minimum tax:
Attempts to ensure that anyone who benefits from certain tax deductions, exemptions, losses and credits pays at least a minimum amount of tax.
Is a separate method for determining tax liability that eliminates many deductions, exemptions, losses and credits.