How does the alternative minimum tax credit work?

January 29, 2007

Date:   Thu, 14 Dec 2006
From:   Dan

I’m confused about the AMT credit. I believe I should have an AMT credit carryforward from 2005 based on some ISOs we exercised in 2005. But the return shows no credit. Perhaps I should amend last year’s return? Are there situations where it would be possible to pay a lot of AMT due to ISO exercise, but still not have the credit available for later years?


Date:   Fri, 29 Dec 2006

Hello Dan,

The credit will be determined on Form 8801, Credit for Prior Year Minimum Tax, with your 2006 income tax return. You can get a copy of the form at the IRS web site,

Good luck!

Mike Gray

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