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Coalition for Tax Fairness Announces Deep Disappointment with U.S. Tax Court Decision on Incentive Stock Option - Alternative Minimum Tax.

WASHINGTON -- Ruling Stresses Urgent Need for Congress to Take Action to Ensure Fair Tax Treatment for Countless Hardworking ISO AMT Victims

The Coalition for Tax Fairness (CTF), an organization working to resolve the Incentive Stock Option Alternative Minimum Tax (ISO AMT) crisis, today announced its disappointment with yesterday's U.S. Tax Court ruling against its members Ron and June Speltz. This decision worsens the growing ISO AMT crisis, which is causing extreme financial hardship for countless Americans. The AMT tax on ISOs has impacted many employees of small and large companies across America, often resulting in taxes up to and exceeding 300-400 percent of these employees' annual salaries.

Yesterday's court decision ruled the IRS did not abuse its discretion in refusing to accept the Speltzes' offer in compromise regarding their ISO AMT tax liability - 220% of their entire taxable income and eleven times the typical tax rate for their income level - meaning the IRS can enforce its lien and the Speltzes will have to pay yet more tax on unrealized income. The decision removes hope that ISO AMT victims might find some relief in the Tax Court, and underscores the need for a swift legislative solution.

"We are crushed and disheartened that the Tax Court did not grant relief, as we have always believed that the laws are intended to be fair for all Americans," stated Ron and June Speltz. "Being forced to pay more than 11 times what the normal taxpayer would pay in taxes is destroying us financially and has caused immense stress and hardship for more than four years. We plead with Congress to please act quickly to put an end to this nightmare, before we lose everything we have and are destroyed financially for years to come."

"The judge's opinion leaves no current legal option for the scores of people that are being devastated by the AMT treatment of incentive stock options, and underscores the urgent need for Congress to act on legislation to provide remedial relief," said Tim Carlson, attorney for the Speltzes and President of the Coalition for Tax Fairness. "The Tax Court specifically stated 'we believe that here . . . the solution must be with Congress,' so now the only hope for the Speltzes, and others like them, is for Congress to take action to correct this serious injustice. I am encouraged at the attention that Congress is paying to this critical issue, and the bi-partisan support that is building in both the House and Senate for legislation to correct this unintentional harm being done to hardworking, honest taxpayers."

CTF is proposing a bill that encompasses the following provisions to remedy unfair ISO AMT tax burdens and help prevent similar situations from arising in the future:

--Ensures fair and proportional tax rates for ISO AMT taxpayers in both "up" and "down" economies;

--Increases compliance via reporting provisions which ensure everyone pays their fair share of ISO AMT taxes, thereby helping to generate increased tax revenue; and

--Accelerates refund of ISO AMT overpayments for taxpayers who have overpaid their taxes, and essentially provided the government interest free loans of hundreds of thousands of dollars.

About the Coalition for Tax Fairness

The Coalition for Tax Fairness (CTF) is a non-partisan, non-profit organization that is coordinating a new legislative initiative to fix the current Incentive Stock Option Alternative Minimum Tax (ISO AMT) crisis. This growing problem was brought on by outdated laws unfairly affecting an unprecedented number of citizens, resulting in extremely disproportional taxes on income that will never be received. Through a combination of education, legislation, and grassroots efforts, CTF is seeking to raise awareness about the current crisis, and is proposing a principled legislative approach that helps ensure tax equity and fairness. CTF was founded by ISO AMT victims and is managed by a group of national volunteers. For more information, visit
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Publication:Business Wire
Date:Mar 24, 2005
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