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Author: BigBooty Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 121565  
Subject: Re: AMT and LTCG Date: 3/6/2000 9:38 PM
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Hey foolishtomtom!

28% isn't my tax bracket, it is the alternative minimum tax rate (I'm dumb, but I ain't stupid).

And the excercise was at .90 when the fair market value was 4$ (current price is 750$, split-adjusted). So I haven't gotten myself into any tax trouble yet.

My question is "do long term capital gains count towards AMT".

If I take a LOT of money from long term gains (@20%), and long term gains count towards AMT, then I would be taxed at the alternative minumum tax percentage(again, 28%) if my total gains if that amount was greater than your normal taxes(which it surely would be. My salary is nothing compared to this money).

I plan on holding a large portion for long term gains. With that in mind, it seems that i can sell a smaller chunk for short term profits with no real tax disincentive, since I know I'm stuck paying the Alternative Minimum Tax (28%) in either case.

Unless long-term capitol gains don't count towards AMT, in which case there would be a BIG incentive to hold out for 2 more months(since it would be 20% vs 40%). Somehow, that would seem unfair (isn't the point of AMT to make sure that EVERYBODY pays at least 28%?, NO MATTER WHAT)? But it would sure benefit me, so I'm hopefully askingthe boards.

Anybody else out there with experience with AMT brought on by collecting long-term-capitol-gains? I'm sorry that original post was unclear. 28% isn't my tax bracket, it is the AMT %, which I will surely hit if LTCG apply towards AMT.

Thanks for the URL, by the way. I've got a dif't book but I think I'll buy that one as well.

thx
bigbooty
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