The bill faces an uphill struggle, though. For starters, Lofgren is a Democrat, and the Republican majority will determine whether her bill will be discussed. Those affected must lobby their co-workers and fellow taxpayers as much as Republicans. Passing retroactive relief will not seem fair to people who dumped their stock at depressed prices because they knew they risked paying AMT bills on their evaporating paper profits if they held on for a long-term capital gains tax break. To win widespread support, people facing AMT bills must explain convincingly why they didn't turn their paper profits into real profits.
Critics say they are suffering because of their own greed.
Although many bristle at bailing out people who make mistakes that are clear in hindsight, it is hardly unusual. Americans blithely build homes on earthquake faults, flood plains and within harm's way of mudslides and wildfires, yet the government routinely comes to their aid when disaster strikes. If a legislative solution doesn't take shape, the IRS can still provide relief by conjuring up compassionate ways to help these people through their troubles. My sense is that the IRS simply doesn't know what it's facing. The IRS is months away from being able to count how many are strapped.