US Alternative Minimum Tax (AMT) Calculator

The AMT is a parallel tax system that recalculates your tax liability with certain deductions and preference items added back to your income (forming Alternative Minimum Taxable Income, or AMTI), then applies a flat exemption and the 26%/28% AMT rates. You pay the higher of your regular tax or this 'tentative minimum tax' — so AMT only bites when the AMT calculation exceeds your regular federal income tax.

For 2025 the exemption is $88,100 for single filers and heads of household, $137,000 for married filing jointly, and $68,500 for married filing separately. The exemption reduces your AMTI before the 26%/28% rates apply, but it phases out for higher earners.

Once your AMTI exceeds $626,350 (single/head of household) or $1,252,700 (married filing jointly) for 2025, the exemption is reduced by 25 cents for every dollar of AMTI above that threshold. At a high enough AMTI the exemption is reduced to zero, meaning the full AMTI is taxed at the AMT rates with no exemption cushion at all.

26% on the first $239,100 of your AMT base (AMTI minus exemption) for 2025 — $119,550 if married filing separately — and 28% on the amount above that. Unlike the regular seven-bracket system, AMT has only these two rates, but because the exemption phases out, the effective rate on AMTI can rise well above 28% for high earners caught in the phase-out range.

Common triggers include exercising incentive stock options (ISOs) and holding the shares (the spread between strike price and market value is an AMT preference item), large state and local tax deductions, and certain other itemized deductions that are added back for AMT purposes. High-income earners with concentrated equity compensation are especially exposed.

You owe AMT only if your tentative minimum tax (calculated on Form 6251) exceeds your regular federal income tax liability for the year — you then pay the regular tax plus the difference. This calculator estimates the tentative minimum tax side of that comparison; compare the result against your regular tax (our income tax calculator estimates that) to see whether AMT actually applies to you.

Not always, but it is the classic trigger. Exercising and holding incentive stock options creates an AMT preference item equal to the spread between the exercise price and the fair market value at exercise, even though no regular-tax income is recognised at that point. A large ISO exercise can push AMTI high enough that AMT exceeds regular tax for that year, even though selling immediately (a disqualifying disposition) would avoid this AMT effect at the cost of ordinary income tax treatment.

Yes — AMT paid due to timing differences (like the ISO exercise spread) can generate a minimum tax credit (Form 8801) that can offset regular tax in future years once the AMT preference reverses (for example, when you eventually sell the ISO shares). This calculator does not compute the credit; it applies to future planning once you have paid AMT.

For 2026, under the One, Big, Beautiful Bill Act, the exemption rises to $90,100 (single/head of household) and $140,200 (married filing jointly), while the phase-out threshold drops to $500,000 (single/head of household) and $1,000,000 (married filing jointly) — a lower threshold than 2025, meaning the phase-out starts sooner for high earners in 2026. This calculator uses the 2025 figures for the current filing season; check the 2026 figures separately for next year's planning.

Indirectly — the regular-tax deduction for state and local taxes (SALT) is added back for AMT purposes, so residents of high-tax states who claim a large SALT deduction on their regular return often see a bigger gap between AMTI and regular taxable income, increasing AMT exposure relative to residents of low-tax states with an otherwise similar income.

No — long-term capital gains and qualified dividends retain their preferential rates within the AMT calculation, similar to the regular tax system. AMT mainly affects ordinary income items and preference add-backs like the ISO spread and certain deductions, not the capital-gains rate itself.

Often, yes. Spreading ISO exercises across multiple tax years, rather than exercising a large block in one year, can keep the AMT preference item in each year below the level that would push your tentative minimum tax above your regular tax. This is one of the most common AMT planning techniques for employees at growth companies with significant ISO grants.

The standard deduction (and personal exemptions, where relevant) are added back for AMT purposes — they are not allowed in the AMT calculation. This is one reason taxpayers who take the standard deduction can still be pulled into AMT territory if other preference items (like a large ISO exercise) are significant enough.

No — while very high earners are affected by the exemption phase-out, moderate earners with a large one-off AMT preference item (most commonly an ISO exercise, or occasionally certain private activity bond interest) can trigger AMT even with an otherwise ordinary income level. The AMT is triggered by the gap between AMTI and regular taxable income, not simply by total income.

It estimates your tentative minimum tax from AMTI using the 2025 exemption, phase-out and 26%/28% rates. Your actual AMT liability, if any, is the excess of that figure over your regular tax, and computing AMTI itself requires adding back specific preference items to your regular taxable income — a step this calculator assumes you have already done.

AMTI starts from your regular taxable income and adds back items disallowed for AMT purposes — the state and local tax deduction, the standard deduction, the ISO exercise spread, and certain other preference items and adjustments. The result is usually higher than regular taxable income, which is why AMT can apply even to taxpayers who feel they have already paid substantial regular tax.

The preference item itself is a one-time addition in the year of exercise, but if you paid AMT because of it, you generally build up a minimum tax credit that can be used in later years once your regular tax again exceeds your AMT — often when you sell the shares and the AMT and regular tax calculations converge. Tracking this credit across years is important and easy to lose track of without professional help.

It applies the exact 2025 Form 6251 mechanics — the exemption amounts, the 25-cent phase-out, and the 26%/28% rate structure — so it is accurate for estimating tentative minimum tax from a given AMTI figure. It does not calculate AMTI itself from your raw income and deductions, and does not compute the minimum tax credit, so treat it as the second half of a two-part AMT estimate.

The calculation runs entirely in your browser and nothing is stored unless you choose to download the branded PDF report, at which point you provide your name and email so we can send it. Phone and address are optional.

Yes. Enter your name and email (phone and address optional) and we generate a TaxStone-branded PDF of your AMT estimate to download instantly — useful for planning an ISO exercise or sharing with your tax preparer.

Yes — AMT exposure from equity compensation is one of the most common, and most avoidable, expensive surprises for tech employees and executives. Book a free 20-minute call with a TaxStone Enrolled Agent before a large ISO exercise to model the AMT impact and the best timing.