First it totally favors the super-rich and the poor, killing middle-classers like us. Second, my friend and his wife, both radiologists, are moving to Australia to work for a U.S. nighthawk company there, and they get to exclude the first $171,400 of their income, paying absolutely no federal tax on that. Meanwhile I'll be stuck in Manhattan paying Federal and state and city taxes...

Middle class taxpayers who work as employees are definitely at a disadvantage under today's income tax code. That's why you need to do whatever you can to minimize your tax burden - such as max out your 401(k) or 403(b) plans, pay for whatever expenses you can with pre-tax dollars, and own where you live.

If you do some moonlighting, you need to be sure to claim whatever expenses you can against that income. And then contribute to a SEP based on the remaining profit.

With the AMT as it currently stands, households earning between $150k and $550k are being hit very hard.

With respect to your friends working in Australia, don't forget that they will be paying Australian taxes on all the money they earn there. So it definitely will not be all tax-free.

Zip Code: 01801

Good point about the AUS taxes they have to pay, Andrew. Now I feel better.