In 1969, Joe Barr, the last of LBJ’s Treasury Secretary’s (he served only 30 days) became famous. He testified before Congress that 21 millionaires had paid no income tax in 1967. A taxpayer ‘revolt’ was at hand.

Congress, in an effort to chase down those 21, created the Minimum Tax of 1969. Ultimately this became what you and I know as the Alternative Minimum Tax. The unintended consequence of this bending of tax policy is that AMT now impacts four million taxpayers, 27% of whom have AGI below $200,000 per year.  But I digress.

Whether you agree with Mr. Obama’s premise that too many billionaires pay too little tax is not the point. Our tax system is complicated, thus enabling financial institutions to create tax reduction strategies and products. Too many Americans rely on these passive strategies in the name of tax savings.  Remember this: “Taxes cannot be reduced by tax-advantaged financial instruments alone!” It is only through a well-coordinated and integrated process along with a sound economic process that taxes can be truly reduced both now and in the future.

Oh, and an econometric model that will allow you to test these proven strategies.

My prediction: regardless the outcome of the current tax debate, too many Americans will overpay their taxes this coming year simply as a result of the positioning of their assets, current volatility of the markets, and the turnover in their taxable portfolios. Don’t rely on the government or traditional financial planning strategies to protect you. You must do something now to limit this exposure.

If you don’t…prepare to be ‘Buffeted.’