A conversation with tax expert Martin Sullivan on the new corporate AMT

The new book income corporate Alternative Minimum Tax effective in 2023 reduces S&P 500 earnings by about 1%, and raises total corporate taxation by 5% to 10%. It impacts individual companies very differently, depending on their tax credits, depreciation and exposure to overseas income. It's too early to say for sure, but something like 75 S&P 500 companies are likely to see their tax bills increase. The exact results won't be known until the Treasury Department finalizes rules and regulations under the new legislation, and this process will be intensely lobbied through year-end implementation and beyond. The impact of the tax potentially fades to the extent that certain expiring provisions of the Trump tax cuts sunset away, but that's only because such sunsetting raises corporate taxes in other ways. The new excise tax on corporate stock buybacks discourages recycling corporate cash to investors, and having been put in place, will be very difficult ever to remove.