True, Flu, but the AMT rate is 28%, whereas the top marginal rate is 35%, going up to 39.5%, so you still pay more than the AMT rate if you are “rich”, even with the lost deductions. This will be especially true starting in 2011, when the itemized deduction phase-out is back in full force, since AMT income will be much closer to regular income.
Be thankful you don’t have New Jersey style property taxes (yet) in CA. AMT must crush the $250K earners in New Jersey who are paying $25K and up in property taxes in addition to state income taxes, plus mortgage interest.
