1. Your year
2. Your options
Fill in the boxes above, then click Find my AMT crossover.
Result
Exercise sizes compared
| Options | Exercise cost | Spread | AMT owed | Cash needed | Marginal AMT rate |
|---|
How it is calculated
Tax year 2026. Regular taxable income is wages less pre-tax deductions and the larger of the standard deduction (single $16,100, married filing jointly $32,200, head of household $24,150) or your itemized deductions, taxed at the 2026 brackets. Alternative minimum taxable income starts from wages less pre-tax deductions, disallows the standard deduction and any state and local taxes, and adds the ISO spread. The AMT exemption is $90,100 single and head of household, $140,200 married filing jointly, reduced by 50 cents per dollar of AMT income over $500,000 ($1,000,000 married). The tentative minimum tax is 26% up to $244,500 of AMT income after the exemption and 28% above. AMT is the amount by which it exceeds regular tax. The crossover is found by searching for the largest spread that leaves AMT at zero.
Not modelled: nonqualified options, net investment income tax, other AMT adjustments, state AMT, other income, credits, the $100,000 ISO limit, other years. Unverified: checked by hand calculation and unit tests, not against Form 6251. Check the 2026 parameters against the IRS's own instructions before relying on them.
Common questions
How many ISOs can I exercise without paying AMT?
It depends on the rest of your income. This tool computes your alternative minimum tax income with and without the option spread, and finds the largest spread that leaves your AMT at zero, then converts that into a number of options at your strike and current 409A value.
Why do ISOs trigger the alternative minimum tax?
Exercising incentive stock options creates no regular income tax, but the gap between the fair market value and your strike price (the spread) is an adjustment for the alternative minimum tax. If the AMT calculation comes out above your regular tax, you pay the difference in the year you exercise, even though you have sold nothing.
Is there withholding when I exercise ISOs?
No. ISO exercises are not wages, so nothing is withheld. Any AMT is paid with estimated tax payments or when you file. The tool shows the cash you need at each exercise size: the exercise cost plus the AMT.
What is the AMT credit?
AMT paid because of ISO spread is a timing difference. It carries forward as a minimum tax credit that reduces regular tax in later years, but only to the extent your regular tax exceeds your AMT. It can take years to use and is lost value if you never have that room, so treat it as a maximum, not a refund.
What if I exercise and sell in the same year?
That is a disqualifying disposition. The spread is taxed as ordinary wages rather than as an AMT adjustment, so there is no AMT on those shares, but the ordinary-income treatment and possible withholding apply. To keep ISO treatment, hold shares one year after exercise and two years after the grant date.
Where do I find the fair market value?
For a private company it is the latest 409A valuation, which your equity administrator can give you. For a public company it is the market price on the day of exercise. The AMT spread uses the value on the day you exercise, so the number can move between planning and doing.
What does this tool leave out?
Nonqualified options, the net investment income tax, credits, other AMT adjustments and preferences, state AMT, income other than the wages you enter, the interaction with restricted stock, the $100,000 limit on ISO treatment, and years other than 2026. The AMT parameters should be checked against IRS Form 6251 instructions.
Is my information uploaded anywhere?
No. Everything you type stays in this browser tab. There are no accounts, cookies or analytics vendors.