• Corporate Payment of Shareholder Expenses
• Hire your kids, cut your taxes
• Don't be fooled
• Implication of tax law
• Setting up your business?
• Smorgasbord of Benefits
• Tax planning
• Tax traps
• Travel expenses
• True impact of tax cut

PERSONAL FINANCE STRATEGIES

You may have more reasons to worry than you think. The Alternative Minimum Tax requires taxpayers to give back 28 write-offs allowed under the regular tax system. In general, taxpayers should calculate taxes under both the regular tax and AMT provisions, then pay whichever bill is higher. Here are 10 common items that are treated differently under the AMT:

Personal exemptions: Larger families will feel the AMT pinch more, especially as the tax cut phases in.

State and local taxes: Currently, residents in high-tax states like California are hit hardest.

Legal settlements: Your lawyer's cut isn't deductible, so you'll be taxed on the full settlement.

Incentive stock options: The paper profit on ISOs may be subject to AMT, even if the stock later plunges in value.

Large capital gains: Some taxpayers owed AMT in 2000 because of record distributions from mutual funds, even though the funds lost money.

Employee business expenses: Workers lose this write-off if they are reimbursed in the form of wages, a common practice for Silicon Valley telecommuters and sales reps.

Medical expenses: Under the regular tax system, you can deduct medical expenses that exceed 7.5 percent of your adjusted gross income. AMT taxpayers can deduct only the amount that exceeds 10 percent.

Home-equity loans: You may write off your interest payments if you spend the money to buy or improve your home but not pay for college, buy new car or consolidate credit card debt.

Municipal bonds: Deductions for interest earned on "private-activity" bonds is disallowed. General obligation bonds are not affected.

Tax credits: The child credit is allowed under the AMT, but most other family, education and business credits have limited benefits under the AMT.