Although the AMT can be tricky at times, there are several planning strategies that can be implemented to avoid or postpone the AMT tax, they include the following:
- Purchase public purpose municipal bonds.
- Defer the exercise of incentive stock options.
- Sell exercised incentive stock options in the same year they're exercised.
- Review income and expenses.
- Do not prepay state or local income taxes or property taxes as they are not deductible under AMT.
- Deferring deductible medical expenses and charitable giving.
- Postpone capital gains or business income that could trigger AMT by pushing your income over the AMT exemption.
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