The 2026 AMT Phaseout Change and ISOs

For 2025 the AMT exemption started phasing out at $626,350 for single filers and $1,252,700 for joint filers, at 25 cents per dollar. For 2026, P.L. 119-21 resets the start to $500,000 and $1,000,000 and the rate to 50 cents (Rev. Proc. 2025-32). Inside the phaseout each extra dollar of spread is taxed at 39% or 42% AMT instead of 26% or 28%, and the exemption is gone entirely at $680,200 single or $1,280,400 joint. Big exercises and high earners hit AMT sooner than last year's rules suggest.

Last reviewed 2026-10-29. General information, not tax advice. Confirm with Form 6251 or a CPA before you exercise.