Although the Tax Cuts and Jobs Act, which took effect at the start of 2018, has made it harder to trigger the alternative minimum tax (AMT), it is still possible to trigger the AMT if you exercise and hold ISOs with a big spread (see the FAQ on the AMT calculation). The figures in the table below estimate the tipping point for positive adjustments (e.g. ISO exercises) that, when added back to your taxable income, can trigger the AMT. The figures are based on tax law as of January 2018, and were provided by BNA Income Tax Planner, the income-tax-planning software preferred by leading tax practitioners. The AMT income exemption amounts for 2018 are $109,400 for married joint filers and $70,300 for single filers.

The numbers in the table and graph below assume that the taxpayer uses the standard deduction amount and that no state tax is paid during the year. These figures will change according to any state tax you pay, and other factors stemming from your personal situation.

Adjustment Amounts To Regular Income That Will Trigger The AMT In 2018

Regular taxable income

Joint filers

Single filers

$50,000

$57,015

$34,995

$75,000

$43,552

$31,149

$100,000

$38,785

$28,650

$125,000

$34,937

$26,725

$150,000

$31,093

$24,805

$175,000

$28,015

$28,265

$200,000

$26,093

$34,033

$225,000

$24,170

$41,383

$250,000

$22,245

$47,633

$275,000

$18,979

$53,883

$300,000

$15,406

$60,133

$325,000

$14,693

$66,383

$350,000

$18,265

$72,631

$375,000

$21,835

$78,881

$400,000

$25,406

$85,131

$425,000

$31,658

$85,705

$450,000

$37,906

$85,705

$475,000

$44,157

$85,705

$500,000

$50,406

$85,705

The graph below illustrates how AMT trigger points change according to income level. (Click on the image to enlarge the graph in a new browser window.)

These numbers assume that the regular taxable income does not include long-term capital gains or qualified dividends (taxed at a rate of 15% or 20%, depending on yearly income). If your income does include such items, the AMT trigger points may be lower.

The AMTI exemption amount is phased out for high-income individuals by 25 cents for every dollar of AMTI over specified thresholds. The TCJA substantially increased these thresholds. In 2018, for single filers the phaseout range starts at $500,000 of AMT income, and for married joint filers the phaseout range starts at $1,000,000 of AMT income. The exemption is fully phased out when AMTI equals or exceeds $781,200 for single filers and $1,437,600 for joint filers.

See also the articles and FAQs on this website about various other AMT topics, including the AMT calculation and methods of limiting and managing the AMT.