I had a very interesting conversation with a coworker (who shall remain nameless) this morning about various things, among them was the Alternative Minimum Tax.  This issue has been getting some prominent attention in the blogosphere as of late, so I found what she had to say particularly interesting.  I won't go into all the particulars of her life that make this truly interesting, but hers is not an abnormal situation these days.  She made more money than her husband did when they got married, and after having their daughter, it came time to decide how they were going to handle things.  Because of money and benefits, it made much more sense for her to go back to work, but would her husband also work?  He had recently been laid off, and they were trying to determine whether it was worth him getting a new job.

Given the industry I work in right now, it's not surprising that she pulled out a spreadsheet and calculated out everything.  How much would he be making, travel costs, day care, etc. to see if it was really worth it for him to go back to work.  She also recalculated their taxes based for the new year based on the extra income, and found out that they'd now be pushed into the AMT where before they weren't.  As it turns out, the new taxes they'd be forced to pay with the AMT took a big chunk.

After figuring all out, she said that her husband's take home pay would have ended up being around $2.00 an hour.  She said, "Honey, it's not worth you getting out of bed for that."  He's now a stay at home dad.