Hello
I'm looking to know how to calculate adjusted capital gains/losses for the following situation:
- I exercised ISOs early 2021 (just before my company went public) and held
- In my 2021 taxes, I paid AMT taxes on the unrealized capital gains from exercising the ISOs
- I sold some of these stock in 2022 as long-term stocks for less than the value of the stock at the time I exercised.
Filing taxes now, but the cost basis reported for the sales of the stock is at my strike price, and not adjusted for the tax. So it looks like I'm paying tax again. Is this just covered by AMT credit over time, or do I also need to do an adjustment for capital gains/losses?
Example (not real numbers - just for reference; also indicating that I'm selling all my ISOs for simplicity in this example):
- In 2017 I was granted 100 ISO options.
- Early 2021, I exercised all 100 stocks with a strike price of $2 and a values of $102. That gives me a $10,000 liability.
- For my 2021 taxes, I paid $2,000 in taxes for the unrealized gains, which put me over my AMT. This was filled out in Form 6251 field i.
- In 2022, I sold all 100 shares at a value of $57 as long term (was more than 1 year since exercising). This is selling at $55 greater than my original strike price, but $45 less than the price I exercised the stock at
- Filing my 2022 taxes, my 1099 shows me that I sold 100 shares at $57, but with a cost basis of $2. This is showing that my tax liability is $5,500, and I am asked to pay $1,100
- I already paid taxes on the unrealized gains in the previous year. When you get to the page in TurboTax, it doesn't help me walk through any steps or calculations on how to solve this - simply has two boxes for "short-term capital gain/losses adjustment" and one for "long term". How do I calculate this?
