AMT 2026 Calculator
Calculate Alternative Minimum Tax (AMT) for 2026 — parallel tax system that limits high-income tax breaks. Exemption $88,100 single / $137,000 married, phase-out begins $626,350 single / $1,252,700 married.
What Is AMT?
Alternative Minimum Tax is a parallel federal income tax system enacted 1969 to ensure high-income filers pay minimum tax even after deductions. Computes tax two ways: regular tax and AMT tax. Owe the higher of the two. AMT adds back certain deductions (SALT, miscellaneous itemized, ISO exercise spread) and uses different brackets. Post-TCJA changes made AMT less impactful for most middle-class filers but ISO exercisers still hit it.
AMT 2026 Exemption and Rates
Exemption (subtracted from AMTI): $88,100 single / $137,000 MFJ. Phase-out begins at $626,350 single / $1,252,700 MFJ — reduces $1 of exemption per $4 of AMTI over threshold. AMT rate: 26% on first $232,600 of AMTI above exemption (2026), 28% above that. Compare AMT tentative tax to regular tax — owe the higher.
ISO AMT Trap
Most common AMT trigger: exercising Incentive Stock Options and holding shares. The spread (FMV minus strike) at exercise counts as AMT preference item but NOT as regular taxable income. Example: $200K ISO spread, $88K exemption = $112K × 26% = $29K AMT. Without ISO income on regular tax, this hits as surprise. Mitigate: spread ISO exercises across years, sell ISO same year (disqualifying disposition removes AMT), or pre-pay AMT to start regular-tax credit clock.
AMT Credit (MTC) — Recover Future Taxes
AMT paid due to 'timing items' (like ISO exercise) generates Minimum Tax Credit (MTC). Carries forward indefinitely. Used in future years when regular tax exceeds tentative AMT — credit applied to reduce regular tax. Many ISO exercisers eventually recover most AMT paid via MTC, but it takes 3-10 years and requires ongoing tracking (Form 8801). MTC is the silver lining of paying AMT on ISOs.
Sources: IRC §55-59, IRS 2026 inflation adjustments, Form 6251 instructions. Last updated: May 2026. Not tax advice.
Frequently Asked Questions
What is AMT?
Alternative Minimum Tax \u2014 parallel tax system ensuring high-income filers pay minimum tax even after deductions. Calculate both regular and AMT; owe the higher.
What triggers AMT?
Common triggers: large ISO exercise + hold (spread is AMT preference), large SALT deduction (capped under TCJA), miscellaneous itemized deductions. Less common post-TCJA for middle income.
What's the AMT exemption 2026?
$88,100 single / $137,000 MFJ. Phase-out begins at $626,350 single / $1,252,700 MFJ \u2014 reduces $1 of exemption per $4 of AMTI over threshold.
Can I recover AMT paid?
Yes via Minimum Tax Credit (MTC). AMT from 'timing items' (ISO exercise) carries forward indefinitely. Apply against regular tax in future years. Track on Form 8801.
Is this tool free?
Yes. 100% free, no sign-up. All math runs in your browser \u2014 your data never leaves your device. Not tax advice.