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Why am I getting hit with the Alternative Minimum Tax (AMT)?

by Intuit Updated 6 months ago

Although the Tax Cuts and Jobs Act (TCJA) that was signed into law in December of 2017 substantially reduced the number of taxpayers subjected to the AMT, it didn’t completely eliminate it.

Common reasons for getting hit with the AMT include:

  • Exercising or selling ISOs (incentive stock options)
  • Deducting interest from a large second mortgage for a house boat or recreational vehicle
  • Realizing a large capital gain (for example, when you sell a home or other investments for a profit)
  • Having a household income greater than the phase-out thresholds while also having a significant amount of itemized deductions

If you're subject to the AMT, you don't have to pay it separately—we've already accounted for it in your refund or taxes owed amount.

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