"Brokers 1099-B shows full spread between exercise price and sale price."
Assuming that the sale is a qualifying sale, (two or more years after grant, one or more years after exercise), then the broker's report of basis is correct. You are getting the huge tax benefit of paying the tax on your gain at long term capital gains rates instead of your regular income tax rates that are much higher.
You don't want to use the method suggested by TurboTaxMinhT. First, you have no adjustment to basis to report and, second, that method won't "feed" the Form 6251 the correct, (presumably higher), basis that's the stock's fair market value at the date of exercise.
This is one of the few times that I recommend using the TurboTax ISO step by step method to report the sale. It states your capital gains correctly for regular taxes - proceeds minus your cost of exercise - and also puts the correct "reversing" adjustment on line 17 of Form 6251.
You may or may not get some credit for the AMT taxes you paid, it's "situational." You can't think of the additional tax you paid for AMT as a simple "timing difference", i.e., "I pay additional tax now but get it back when I sell" because it just doesn't work that way.
Tom Young
