2028 AMT Exemption
2028 AMT exemption (projected): single $91k, MFJ $142k, MFS $71k. Phase-out 25 cents per $1 above $640k single / $1.28M MFJ. 26%/28% AMT rates.
| AMTI | — |
| Base exemption | — |
| Phase-out loss | — |
| 2028 effective exemption | — |
| Income after exemption | — |
| Tentative AMT | — |
The 2028 AMT exemption is projected at $91,000 single / $142,000 MFJ. Above $640k single / $1.28M MFJ, the exemption phases out 25 cents per dollar. AMT applies if higher than regular tax. Common triggers: ISO exercise, large state tax deductions, private activity bond interest.
AMT Mechanics
Compute regular tax. Compute AMT (add back preferences, apply exemption, then 26%/28% rate). Pay the higher. AMT preferences include: state income tax deduction, ISO exercise gain, private activity bond interest, depreciation timing differences.
OBBB Reduced AMT Reach
OBBB kept the TCJA-raised exemption permanent + higher phase-out thresholds. Result: AMT affects ~200,000 filers per year vs ~5 million pre-TCJA. Mostly high earners with large ISO exercises or significant state tax in high-tax states.
ISO Exercise Planning
Incentive Stock Option exercise creates AMT income equal to bargain element (FMV - strike × shares). Plan exercises across years to stay under exemption. Disqualifying disposition (sell same year) converts to ordinary income — eliminates AMT issue.
AMT Credit Carryforward
AMT paid creates a credit usable in future years when regular tax exceeds tentative AMT. Track on Form 8801. Can recover AMT over time if income normalizes.
Last updated May 2026. Sources: IRS AMT.