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ISO selling price was much lower than FMV at exercise but higher than the grant value. Paid AMT at exercise. 1099-B reported basis as the grant value, meaning a capital gain. How to get the AMT credit back?
For simplicity, I've truncated the numbers and only use rounded numbers below.
In 2019, I was granted 1000 shares of incentive stock option (ISO) at $2/share.
In 2021, I exercised and held them at FMV of $40/share. I received form 3921. I also exercised other shares and thus triggered AMT. So I paid AMT for unrealized gain: ($40-$2)x1000=$38000.
In 2023, I sold the 1000 shares at $10/share. The 2023 1099-B reported the basis as the grant value ($2x1000=$2000).
Does that mean I need to pay long term capital tax gain (($10-$2)x1000=$8000)? That seems so unreasonable because it's double taxed.
How do I get the AMT credit back? Can TurboTax look back 2021's tax return and automatically adjust? I'm using the desktop version of TurboTax. Thanks!
March 19, 2024
10:53 PM