Late refunds thanks to Democratic diddling

Democrats opted to play a game of chicken rather than deal with the hated "alternative minimum tax" in a timely fashion.

Now, tens of thousands of taxpayers will pay the price.

It was just last week that the House finally approved a temporary "patch" to the AMT, ensuring the levy didn't suddenly hammer 20 million middle-class families.

The tax was implemented almost 40 years ago to prevent a handful of millionaires from using legal deductions to offset their entire income tax bill. But it was never indexed for inflation, so each year the assessment hits more and more taxpayers.

Instead of eliminating the tax entirely, Congress in recent years has chosen stop-gap solutions of annual "fixes" that need to be "fixed" again the next year. In 2007, with Democrats running Congress, the patch was delayed for months because the House leadership insisted that any AMT legislation be "paid for" with an additional $50 billion tax increase somewhere else.

This was a crock to begin with. Everybody knew the extra money that the AMT was supposed to generate as it smothered more and more Americans would never materialize. Yet the Democratic Congress spent it anyway.

Republicans in the Senate refused to go along with this shell game, insisting that there was no need to "pay" for any AMT adjustment. And they had the votes to insist upon it. But the Democratic House resisted, even demanding one more futile Senate vote last week. They were gambling that Republicans would take the blame for any delays.

But when their strategy predictably failed, House Democrats backed down and finally approved the AMT fix without any concurrent tax hikes rather than risk the wrath of the many taxpayers threatened for the first time with the levy -- which would have, on average, increased the tax bills of many middle-income Americans by about $2,000.

The "fix" could have been wrapped up months ago.

But thanks to Speaker Nancy Pelosi and her gang's greed, the IRS announced Thursday that millions of early tax filers will have to wait until February to get their refunds. Because Congress waited so long to act on the AMT, the agency won't be able to start processing many forms for weeks after they're received.

Last year, between 3 and 4 million taxpayers filed their returns in January.

"We regret the inconvenience the delay will mean for millions of early tax filers, especially those expecting a refund," acting IRS Commissioner Linda Stiff said.

In addition, Ms. Stiff said as many as 13.5 million taxpayers who must use AMT-related forms will have to wait until February 11 to start filing. That's because the tax packages that will start arriving in the mail beginning after New Year's Day were printed in November, before the AMT fixes were approved by Congress.

Taxpayers may get updated copies of AMT-related forms at www.irs.gov to expedite the process.

Remember also that individuals who receive an IRS refund have essentially given the government an interest-free loan for months. The longer money for potential refunds sits around the federal treasury, the more interest that accumulates for the government.

And that should make congressional Democrats smile.