The federal government's fiscal cliff is looming and your tax returns are among the pressing matters that could be affected. If Congress fails to reach a deal by December 31, as many as 100-million people could see delays in their tax refunds. That's because the income exemption levels under the "wealth tax" or Alternative Minimum Tax were never adjusted for inflation since it was enacted decades ago.
Over the years, lawmakers have consistently passed a "patch" to raise those levels. They have not done so this year. Without a patch, 45-thousand-dollars for joint filers and just under 34-thousand-dollars for single taxpayers is exempt from the A-M-T.
But adjusted for inflation, those levels would jump to almost 79-thousand-dollars for joint filers and around 50-grand for single taxpayers. The tax filing season begins in two weeks. Both sides agree that a patch is needed, but until a deal is reached, it will not be passed.