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AMT Calculator - Alternative Minimum Tax Estimate
By Worldtickers ·
Estimate whether you owe the Alternative Minimum Tax (AMT) based on your income, deductions, and common AMT preference items.
This amt tool focuses on estimate whether you owe the Alternative Minimum Tax (AMT) based on your income, deductions, and common AMT preference items. Use it to estimate tax exposure, deductions, rates, payments, and after-tax outcomes, then test how income, gains, location, filing choices, or timing may change the final estimate.
Calculator
AMT Calculator
Calculate Alternative Minimum Tax for 2026.
What Is AMT?
The Alternative Minimum Tax (AMT) is a parallel tax system that operates alongside the regular federal income tax. It was created in 1969 to prevent high-income taxpayers from using certain deductions and preferences to avoid paying any federal income tax. The AMT recalculates your tax liability using a modified set of rules — adding back certain deductions, applying its own exemption amounts, and using a different (and simpler) rate structure.
You calculate both your regular tax liability and your tentative minimum tax. If the tentative minimum tax exceeds your regular tax, you owe the difference as AMT. In practice, this means the AMT acts as a tax floor — the minimum amount you must pay regardless of your deductions. The AMT rate is 26% on the first $239,500 of AMT income (for 2026) and 28% above that threshold.
The Tax Cuts and Jobs Act of 2017 significantly reduced AMT exposure by nearly doubling the exemption amounts and capping the state and local tax (SALT) deduction. The number of AMT payers dropped from roughly 5 million per year to under 200,000. However, high earners — particularly those exercising stock options, claiming the SALT cap, or earning significant capital gains — can still owe substantial AMT. After 2025, the exemption amounts are set to revert to lower levels, which could increase AMT exposure for many taxpayers again.
How to Use This Calculator
Enter your regular taxable income (after deductions) and your AMT preference items. The most common preference items are: the state and local tax (SALT) deduction you claimed, incentive stock option (ISO) exercises, certain standard deduction amounts, and other adjustments as listed on IRS Form 6251.
Select your filing status so the calculator can apply the correct AMT exemption amount and phase-out thresholds. For 2026, the exemption is approximately $88,100 for single filers and $133,300 for married filing jointly.
The calculator adds your AMT preference items to your regular taxable income to determine AMTI (Alternative Minimum Taxable Income), subtracts the AMT exemption (subject to phase-out at high income levels), and applies the AMT rate schedule. It then compares the tentative minimum tax to your regular tax and shows whether you owe AMT, and if so, how much.
Formula
The AMT calculation follows a step-by-step process:
AMTI = Regular Taxable Income + AMT Preference Items
AMT Exemption = Base Exemption − 25% × max(0, AMTI − Phase-out Threshold)
AMT Base = max(0, AMTI − AMT Exemption)
Tentative Minimum Tax = 26% × first $239,500 + 28% × excess
AMT Owed = max(0, Tentative Minimum Tax − Regular Tax)
AMT preference items include the SALT deduction (added back), certain deductions disallowed under AMT, ISO exercises (the bargain element), and other adjustments listed on Form 6251. The exemption phases out at a rate of 25 cents per dollar of AMTI above the threshold ($609,350 for single, $1,218,700 for married filing jointly in 2026).
Examples
Example 1: No AMT
A single filer has $80,000 in regular taxable income and $8,000 in SALT deductions (at the $10,000 cap). AMTI = $88,000. After the $88,100 exemption, the AMT base is $0. Tentative minimum tax: $0. Regular tax is higher. AMT owed: $0. The exemption completely shields this taxpayer from AMT.
Example 2: AMT from ISO Exercise
A single filer exercises $200,000 in incentive stock options (bargain element). Regular taxable income is $100,000. AMTI = $300,000 ($100,000 + $200,000 ISO exercise). After the $88,100 exemption, AMT base is $211,900. Tentative minimum tax: approximately $55,094. Regular tax on $100,000: approximately $18,000. AMT owed: approximately $37,094. This illustrates why ISO exercises are the single most common AMT trigger.
Example 3: High Income with SALT
A married couple has $500,000 in regular taxable income and claims the $10,000 SALT cap. AMTI = $510,000. After the $133,300 exemption, AMT base is $376,700. Tentative minimum tax: approximately $97,942. Regular tax on $500,000: approximately $130,000. Since the regular tax exceeds the tentative minimum tax, AMT owed: $0. Despite significant income, the regular tax is higher because of the graduated rate structure.
Tips
Watch ISO Exercise Timing
If you exercise incentive stock options, the bargain element (the spread between exercise price and market value) is an AMT preference item. Consider exercising options in December to give yourself time to plan for the AMT impact, or exercise smaller amounts across multiple years to stay below the AMT threshold. Consult a tax professional before large ISO exercises.
Track AMT Credit Carryforwards
If you pay AMT due to timing differences (like ISO exercises), you generate an AMT credit that can be used to offset your regular tax in future years. Keep detailed records of AMT paid and carryforwards available. Many taxpayers forget about these credits and leave money on the table in subsequent years.
Consider the TCJA Sunset
The doubled AMT exemption amounts are set to revert after 2025. If you are in a situation where AMT exposure is marginal, plan accordingly. The reversion could bring back AMT liability for taxpayers who are currently unaffected, particularly those with moderate-to-high income and SALT deductions.
Use AMT Planning for Capital Gains
Long-term capital gains are taxed at the same preferential rates under both the regular tax and AMT. However, capital gains can push your income high enough to trigger AMT phase-outs of the exemption. If you are close to AMT territory, consider whether spreading capital gains across multiple years could reduce your AMT exposure.
FAQ
What is the Alternative Minimum Tax (AMT)?
The AMT is a parallel tax system designed to ensure that high-income taxpayers who use certain deductions and preferences still pay a minimum amount of federal tax. It operates alongside the regular tax system — you calculate both your regular tax and your AMT, and you pay whichever is higher. The AMT adds back certain deductions that are allowed under the regular tax code and applies its own exemption and rate structure.
Who pays AMT?
The AMT primarily affects middle-to-high-income earners who have large state and local tax (SALT) deductions, exercise stock options, have significant capital gains, or claim certain other preferences. Before the Tax Cuts and Jobs Act, roughly 5 million taxpayers paid AMT each year. After the TCJA raised the AMT exemption amounts and capped SALT deductions, the number dropped significantly — but many high earners in high-tax states still owe AMT.
What are the AMT exemption amounts for 2026?
For 2026, the AMT exemption amounts are approximately $88,100 for single filers and $133,300 for married filing jointly. These amounts begin to phase out at higher income levels — at a rate of 25 cents per dollar of income above the phase-out threshold. The exemption effectively shields the first $88,100 (or $133,300) of AMT income from the 26% AMT rate.
What triggers AMT?
Common AMT triggers include: exercising incentive stock options (ISOs), claiming the SALT deduction (capped at $10,000 under the regular tax but fully added back for AMT), claiming the standard deduction (for AMT purposes, certain deductions are disallowed), large capital gains, and certain business expenses. The combination of high income and these preference items pushes taxpayers into AMT territory.
How do I know if I owe AMT?
You calculate your AMT by starting with your regular taxable income, adding back AMT preference items (such as SALT, certain deductions, and ISO exercises), subtracting the AMT exemption, and applying the AMT rate schedule. If your tentative minimum tax exceeds your regular tax, you owe the difference as AMT. Use this calculator to estimate whether you might be affected.
Does the SALT cap affect AMT?
Yes, indirectly. Under current law, the SALT deduction is capped at $10,000 for regular tax purposes. For AMT, any SALT deduction claimed (up to $10,000) is added back to AMT income. This means the cap actually reduces the AMT hit for many taxpayers compared to pre-TCJA years when the full SALT deduction was added back. However, taxpayers in high-tax states who claim the $10,000 cap still face AMT exposure.
Can AMT credits from prior years be used?
Yes. If you paid AMT in a prior year due to timing differences (such as ISO exercises), you may have generated an AMT credit carryforward. This credit can be used to offset your regular tax liability in future years when the timing difference reverses. The credit is claimed on Form 8801 and can be carried forward indefinitely until used.
Is AMT still common after the Tax Cuts and Jobs Act?
The TCJA significantly reduced AMT exposure by nearly doubling the exemption amounts and capping the SALT deduction. The number of AMT payers dropped from roughly 5 million to under 200,000 per year. However, high earners — especially those with large stock option exercises, significant capital gains, or SALT deductions at the $10,000 cap — can still owe substantial AMT. The exemption amounts are also set to revert to lower levels after 2025, which could increase AMT exposure again.