How do I prepare Form 6251?
March 23, 2005
Subject: ISO Questions
Date: Mon, 07 Mar 2005
When preparing Form 6251, the amount that I calculate for line 16 (gain or loss adjustment) exceeds the amount used on line 13 (adjustment for exercise of ISO) when I bought the stock. When I try to understand the changes for lines 37-39, I’m totally lost. The instructions talk about “AMT Schedule D” and “AMT Qualified Dividends and Capital Gain Tax Worksheet”, neither of which exist on the IRS web site. I have no clue how to calculate these lines.
How do I find someone to help me with this?
Date: Mon, 14 Mar 2005
Your instincts are right. The adjustment at line 13 shouldn’t be more than the original adjustment when you bought the stock.
When the instructions say “AMT Schedule D” and “AMT Qualified Dividends and Capital Gains Tax Worksheet”, they mean that you use the “regular tax” forms with AMT amounts for the basis of the stock, etc. Mark the form “Alternative Minimum Tax” at the top of the page.
You can’t claim you don’t know anyone who understands this when you read this FAQ. My telephone number is 408-918-3161.