The One Big Beautiful Bill Act cut taxes for most households. But for some of your clients, it also reopened the door to the Alternative Minimum Tax, the "stealth tax" many advisors stopped worrying about after 2017.
Starting in 2026, the AMT exemption phases out sooner and twice as fast. The phaseout now begins at $500,000 of AMT income for single filers and $1 million for joint filers, down from about $626,000 and $1.25 million. And it shrinks the exemption by 50 cents per dollar, up from 25 cents. Meanwhile, the bigger SALT deduction of up to $40,000 lowers the regular tax bill but gets added back under the AMT. That can push high earners in high-tax states into the AMT. Incentive stock options and private activity bond interest can do the same.
This session was inspired by Tobias Salinger's Financial Planning article, "5 key questions to calculate the new alternative minimum tax." The article showed how many advisors and clients are underestimating their exposure. CPA Larry Pon picks up where it left off. He'll turn those five questions into a practical framework you can use with clients before year-end.
You'll learn how to:
- Spot which clients are newly at risk, including high-SALT households, ISO holders and municipal bond investors
- Walk through the calculation: AMT income, preference items, the exemption and phaseout, the 26%/28% rates and the tentative minimum tax
- Explain why the new phaseout creates a much higher effective marginal rate in the phaseout range
- Time ISO exercises, income recognition and deductions to manage AMT exposure across tax years
- Recalculate after-tax yields on private activity bonds under the new rules
- Know which questions to bring to the client's CPA, and where tax guidance ends and tax advice begins
