Foundation
Understanding ISOs and AMT
ISOs are the most planning-sensitive form of equity compensation in existence — and AMT is the system that decides whether your plan works. Most people learn AMT the hard way, by accidentally triggering it. This is the primer that lets you use it instead of being used by it.
The Reading List
Articles, in order.
Work through them sequentially, or jump to the one most relevant to your situation.
- 01Reference— EQUITY 101
ISO Stock Option
What an ISO is, how it works, vesting, exercise mechanics, AMT, and the qualifying vs. disqualifying disposition rules that drive the tax delta.
6 MIN6 MIN - 02Reference— EQUITY 101
ISO Taxation
How ISOs are taxed at exercise (AMT only) and at sale (qualifying vs. disqualifying), with the AMT credit recovery mechanics.
7 MIN7 MIN - 03How-to— EQUITY 101
ISO Planning/Strategy
Two ISO decisions — exercise or wait, sell or hold — framed against your financial plan, taxes, and concentration risk.
5 MIN5 MIN - 04Reference— TAX STRATEGIES
Alternative Minimum Tax (AMT)
What AMT is, why it triggers on ISO exercises via dual-basis cost tracking, how credit recoupment works, and how it interacts with state AMT and capital gains rules.
5 MIN5 MIN - 05Opinion— EQUITY ADVANTAGE
4 Things Most Tech Folks With ISOs Don’t Know About AMT (It's Likely Not As Bad As You Fear)
Four things tech folks don't know about AMT — including the prepayment-credit mechanic that makes it much less scary than it looks.
8 MIN8 MIN - 06How-to— TAX STRATEGIES
Exercise ISOs Between January and April
Exercising ISOs in Q1 maximizes flexibility — you can hold for qualifying disposition or disqualify to avoid AMT, and time sales to fund the AMT bill before April.
4 MIN4 MIN - 07How-to— TAX STRATEGIES
Sell ISO-Acquired Stock to Recoup AMT Tax Credit
Selling ISO-exercised shares after qualifying disposition widens the regular-tax-minus-AMT gap, accelerating AMT credit recoupment via dual-basis mechanics.
4 MIN4 MIN - 08Reference— TAX STRATEGIES
ISOs/AMT Tax Strategies
An index of ISO/AMT strategies — qualifying dispositions, early exercise, AMT-limit exercising, credit recoup via sales, capital-loss pairing, 90-day post-termination, and multi-year spread riding.
2 MIN2 MIN
Talk to a 30/40 Advisor
Want this applied to your situation?
A 30-minute consult tells you whether the frameworks in this reading list cleanly apply to your equity package — and if so, what the first three moves are. No pitch.
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