What constitutes “transferable” stock in ISO AMT calculation?
Date: 2 Jan 2000 From: Steven You indicate that a lockup agreement has no influence on AMT amount owed. This seemed to contradictory to IRS publication 525 Employee Compensation. This is a quote from the Incentive Stock option section. ———————— Alternative minimum tax (AMT). For the AMT, you must treat stock acquired through the exercise of an ISO as if no special treatment applied. This means that, when your rights in the stock are transferable and no longer subject to a substantial risk of forfeiture, you must include as an adjustment in figuring alternative minimum taxable income the amount by which the fair market value of the stock exceeds the option price. However, no adjustment is required if you dispose of the stock in the same year you exercise the option. See Restricted Property, later, for more information. Enter this adjustment on line 10 of Form 6251, Alternative Minimum Tax–Individuals. Increase your AMT basis in any stock you acquire by exercising the IS
