Millions of taxpayers could see their refunds delayed next year unless Congress acts quickly to approve a stopgap measure that would prevent a huge expansion of the alternative minimum tax, the IRS said yesterday.

Without the temporary fix, more than 20 million taxpayers will owe the AMT when they file their 2007 tax returns, up from 4 million this year. The AMT is a parallel tax system that eliminates many popular deductions and credits. It was originally targeted at the very rich, but it's gradually expanded to ensnare upper-middle-class and even some middle-class taxpayers.

Congress is expected to eventually approve the fix. But lawmakers in the House and Senate disagree over how to pay the cost, estimated at more than $50 billion. Meantime, the clock is ticking for the IRS, which needs 12 to 13 weeks to reprogram its computers after the bill is signed before it can begin processing tax returns that would be affected by the changes.

The IRS is scheduled to start processing 2007 tax returns on Jan. 14. If lawmakers fail to approve the temporary fix by the end of the month, millions of taxpayers will have to wait longer to receive their refunds next year, IRS acting Commissioner Linda Stiff said in an interview.

The delays would affect the 25 million people who would have owed the AMT before the change, but the impact could be even broader, Stiff said. Taxpayers who claim credits that could be disallowed by the AMT, such as the child and dependent-care credit, would also likely see their refunds delayed, she said. As a result, low- and middle-income taxpayers who aren't otherwise touched by the AMT could be affected, Stiff said.