- MEDICAL Instead of deducting bills on their personal tax return, those with high health-care expenses might set up a medical reimbursement plan through their business. Such a plan could reimburse you--and your employees--for health-related expenses up to a limit of, say, $5,000. Then the business claims the deduction, which isn't subject to the AMT.

INVESTING Many brokers let clients pay 1% or so of the funds under management, but such advisory fees aren't deductible under the AMT. Instead, pay by the transaction. "The commission is added to your cost basis, reducing your capital gain," says Jim Grimaldi, a CPA and lawyer at Lazar Levine & Felix in New York City.

STATE TAXES Overpay state and local taxes, and you can normally deduct the overpayment the following year. But that deduction could trigger the AMT, so monitor your payments carefully. If you think you may be subject to the AMT in 2006 but not 2005, consider prepaying some or all of your 2006 state and local tax bills and taking the deduction in 2005, rather than losing it altogether.

MEDICAL Instead of deducting bills on their personal tax return, those with high health-care expenses might set up a medical reimbursement plan through their business. Such a plan could reimburse you--and your employees--for health-related expenses up to a limit of, say, $5,000. Then the business claims the deduction, which isn't subject to the AMT.

INVESTING Many brokers let clients pay 1% or so of the funds under management, but such advisory fees aren't deductible under the AMT. Instead, pay by the transaction. "The commission is added to your cost basis, reducing your capital gain," says Jim Grimaldi, a CPA and lawyer at Lazar Levine & Felix in New York City.

STATE TAXES Overpay state and local taxes, and you can normally deduct the overpayment the following year. But that deduction could trigger the AMT, so monitor your payments carefully. If you think you may be subject to the AMT in 2006 but not 2005, consider prepaying some or all of your 2006 state and local tax bills and taking the deduction in 2005, rather than losing it altogether.