Alternative Minimum Tax (AMT) Calculator

Finance

The Alternative Minimum Tax (AMT) Calculator estimates the extra federal tax you may owe under the parallel AMT system. It subtracts the AMT exemption from your alternative minimum taxable income, applies the 26%/28% AMT rates, then compares the tentative minimum tax with your regular tax.

Formula

AMT base = AMTI − exemption; TMT = 26% (≤ threshold) / 28% (above); AMT owed = max(0, TMT − regular tax)
  • The AMT is a separate tax system that limits how much certain deductions can lower your tax bill.
  • Subtract the AMT exemption from your alternative minimum taxable income (AMTI) to get the AMT base.
  • Apply 26% to the base up to the threshold and 28% to any amount above it to find the tentative minimum tax (TMT).
  • You pay AMT only if the TMT exceeds your regular tax; the calculator shows that difference. Exemptions and thresholds change yearly and phase out at high incomes.

Example Calculation

Inputs
  • Alternative Minimum Taxable Income ($): 250000
  • AMT Exemption ($): 85700
  • Regular Tax ($): 45000

With AMTI of $250,000 and an $85,700 exemption, the AMT base is $164,300. At 26% the tentative minimum tax is about $42,718. Since that is less than the $45,000 regular tax, no extra AMT is owed.

Frequently asked questions

What is the Alternative Minimum Tax?
It is a parallel federal tax that ensures higher earners who use many deductions still pay a minimum amount of tax.
How do I know if I owe AMT?
You owe AMT only when your tentative minimum tax is greater than your regular tax; the difference is the additional AMT.
What are the AMT rates?
26% on the AMT base up to an annual threshold and 28% on amounts above it.
What is the AMT exemption?
A set amount subtracted from your AMTI before the tax is applied; it varies by filing status and phases out at high incomes.
Are the figures here current?
Exemptions and thresholds change each year, so enter the values for your tax year for an accurate estimate.