βοΈ AMT Calculator
The parallel tax: exemption, phaseout, 26%/28% brackets.
AMT computed on the taxable excess
Estimates for planning only, not financial advice.
The alternative minimum tax runs a second tax calculation in parallel: it takes your income, adds back deductions the regular system allowed, subtracts an exemption, and taxes the remainder at 26 and 28 percent. You pay whichever is higher, regular tax or AMT. For 2026, a single filer with $300,000 of AMTI gets a $90,100 exemption, leaving a $209,900 taxable excess entirely in the 26 percent bracket, for a tentative AMT of $54,574. If regular tax on the same income is $60,000, no AMT is owed; if regular tax is $50,000, the AMT bill is $4,574.
How to Use This Calculator
Enter your AMTI (regular taxable income plus AMT adjustments like disallowed SALT, ISO spreads, and depreciation differences), your filing status, and your regular federal tax for comparison. The calculator applies the 2026 exemption with phaseout, computes tentative AMT at 26/28 percent, and tells you whether AMT actually bites.
Estimate AMTI: start from taxable income and add back your SALT deduction, any ISO bargain element, and other preference items.
Pick filing status. The exemption and phaseout threshold change with it, and married filing separately gets half the 26 percent bracket.
Enter regular federal tax to see the verdict: you owe AMT only if tentative AMT exceeds regular tax. For the regular-tax side, use our income tax calculator.
2026 AMT Parameters
The 2026 phaseout change is the story: thresholds fell to $500,000/$1,000,000 and the phaseout rate doubled to 50 cents on the dollar. In the phaseout zone, each extra dollar of AMTI not only gets taxed but also vaporizes 50 cents of exemption, pushing the effective marginal rate well above 28 percent. Taxpayers between roughly $500,000 and $700,000 of AMTI face the harshest marginal math in the system.
Worked Example: Single Filer, $300,000 AMTI
AMTI: $300,000. Exemption: $90,100 (no phaseout; $300,000 is under $500,000). Taxable excess: $209,900. The 26 percent bracket covers the first $244,500, so the entire excess is taxed at 26%: $209,900 x 0.26 = $54,574 tentative AMT. Against $60,000 of regular tax, no AMT is owed. Against $50,000 of regular tax, AMT owed is $4,574.
Now add phaseout: same filer with $600,000 AMTI. Excess over the $500,000 threshold is $100,000, so the exemption shrinks by $50,000 to $40,100. Taxable excess: $559,900. Tentative AMT: 26% x $244,500 = $63,570 plus 28% x $315,400 = $88,312, totaling $151,882. The phaseout alone added roughly $14,000 to the bill versus a full exemption, which is why the $500,000-to-$700,000 zone deserves careful timing of income and deductions.
What Pulls You Into AMT
| Trigger | How it works | Planning move |
|---|---|---|
| ISO exercise | Spread counts as AMT income, no cash | Model AMT before exercising; spread across years |
| Large SALT deduction | Fully added back for AMT | Bunching deductions can backfire in AMT years |
| Private activity bonds | Interest added back | Prefer non-AMT munis if exposed |
| Big capital gains | Inflate AMTI, phase out exemption | Spread sales across tax years |
The ISO trap deserves emphasis because it creates tax on money you do not have. Exercising options with a $200,000 spread generates $200,000 of AMT income in the exercise year; at 26 percent that can mean a $50,000-plus tax bill with zero cash proceeds if you hold the shares. People have been ruined by this. Never exercise significant ISOs without running the AMT math first.
Living With the AMT
If this calculator says you are in AMT territory, three habits help. First, track the minimum tax credit on Form 8801: AMT from timing items like ISOs comes back as a credit in future non-AMT years, but only if you file the form and remember the carryforward. Second, rethink deduction bunching: accelerating deductions the AMT disallows just moves money from a deductible year to a non-deductible one. Third, model multi-year: sometimes paying AMT this year to use the credit next year beats contortions to avoid it.
And keep perspective: the AMT hits hardest in a narrow band and mostly affects high earners with specific preference items. For most filers it is a non-event, which is exactly what the exemption is for. If your AMTI sits comfortably under $90,100 single or $140,200 joint, close this tab and enjoy the regular system. If it does not, run the numbers here before year-end moves, and get a CPA for the actual Form 6251, because the real form has dozens of adjustments this estimator simplifies.
AMT Planning After the TCJA
The Tax Cuts and Jobs Act shrank AMT exposure dramatically by raising exemptions and killing many preference items, but it did not kill the tax. The people who still trip it tend to share a profile: high earners exercising incentive stock options, with large state tax bills or unusual deductions. If that is you, the planning centers on timing: exercise ISOs in years when you have room under the exemption, and model the exercise before you commit, because the AMT on a big ISO spread can exceed the cash you have on hand.
One underused relief valve is the AMT credit: AMT paid because of timing preferences like ISO exercises generates a credit that offsets regular tax in future years. It is not lost money, just prepaid money, though it can take years to recover. Track it on Form 8801 and carry it forward; many taxpayers who paid AMT in past years are still drawing down credits. The modern AMT is a timing tax for most victims, and timing taxes reward planning.
Estimates for planning only, not financial advice.
Frequently Asked Questions
What is the alternative minimum tax?
The AMT is a parallel tax system: you compute tax the regular way and the AMT way, and pay whichever is higher. The AMT disallows deductions the regular system permits (like SALT) and adds back preference items (like incentive stock option spreads), then taxes the result at 26% and 28%. You owe AMT only when the AMT calculation exceeds your regular tax.
What is the AMT exemption for 2026?
For 2026, the exemption is $90,100 for single and head of household filers, $140,200 for married filing jointly, and $70,100 for married filing separately. The exemption phases out starting at $500,000 of AMTI for single filers ($1,000,000 joint), shrinking 50 cents per dollar above the threshold. These are the inflation-adjusted figures under current law.
How do you calculate AMT step by step?
Start with regular taxable income, add back AMT adjustments (SALT deduction, miscellaneous deductions, ISO bargain element, private activity bond interest, depreciation differences) to get AMTI. Subtract the exemption (after phaseout) to get the taxable excess. Apply 26% to the first $244,500 of excess ($122,250 if married filing separately) and 28% above. Compare the result to your regular tax; AMT owed is the excess.
What triggers the AMT most often?
Incentive stock options are the classic trigger: the bargain element at exercise counts as AMT income even though no cash changed hands and no regular tax is due. Large SALT deductions, private activity bond interest, and big capital gains (which inflate AMTI and phase out the exemption) are the other common triggers.
Do I owe AMT if my income is under the exemption?
Almost certainly not. If your AMTI is below the exemption ($90,100 single / $140,200 joint for 2026), the taxable excess is zero and there is no AMT. The exemption is a true floor: cross it, and the parallel calculation begins. This calculator shows exactly where you stand relative to it.
What changed for AMT in 2026?
Two significant changes took effect: the exemption phaseout thresholds dropped to $500,000 single / $1,000,000 joint (down from much higher 2025 levels), and the phaseout rate doubled from 25 to 50 cents per dollar of excess AMTI. The exemption amounts themselves stayed high and inflation-adjusted. Net effect: more upper-middle and high earners face AMT exposure than in 2025, especially those with ISO exercises or large SALT deductions.
Are ISO stock options really taxed with no cash?
For AMT, yes: the spread between exercise price and fair market value at exercise is an AMT preference item in the exercise year, even though you have received no cash and owe no regular tax until you sell. Employees have owed five-figure AMT bills on paper gains that later evaporated. Anyone exercising ISOs should model AMT first, every time.
Can I get AMT paid back in future years?
Sometimes, through the minimum tax credit (Form 8801). AMT paid on timing preferences (like ISOs) generates a credit you can use against regular tax in future years when you are not in AMT. AMT from exclusion items (like SALT) does not generate the credit. Track it; the credit carries forward indefinitely but is easy to forget.
How do I avoid the AMT?
Time preference items: spread ISO exercises across years, avoid bunching deductions the AMT disallows, and watch the phaseout zone where each extra dollar of AMTI costs 50 cents of exemption plus tax. But never let AMT avoidance drive bad economics: paying some AMT on a genuinely good ISO exercise beats skipping the exercise. Model first with this calculator, then decide.
Does the AMT apply to corporations?
The corporate AMT was repealed for most companies by the 2017 tax law, though a 15% corporate alternative minimum tax on large corporations' book income was added in 2022. For individuals, the AMT is alive and well on Form 6251. This calculator covers the individual AMT.