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The question, below, was asked 5 years ago, but, in looking at the replies, I still do not see an answer with respect to treatment for 2013 stock sale on Form P (540). Replies were only addressing the negative amount that needed to be added to Form 6251, Line 17, not Form P (540), Line 9. 

Can someone answer the question posed, below, regarding whether a similar entry was needed on P (540), Line 9.

--- Original Question:


"Taxpayer (TP) has two ISO related adjustments flowing thru Fed and California AMT forms (6251 and Sched P 540). Firstly in 2013, TP exercised ISO's from her employer and "did not" sell any of these shares acquired thru the ISO in 2013. This resulted in $77k of AMT tax preference - was an addition on line 14 on Form 6251. Secondly in 2013, TP sold shares of stock that she had previously acquired (thru exercise ISO's in 2012), but waited until 2013 to sell. In 2012 TP had to report $ 76k of AMT tax preference on 6251 and Sched P 540. Schedule P handled this $ 76k addition to AMT tax preference perfectly in 2012. Now fast forward to 2013. Taxpayer sold these shares in 2013(acquired in 2012) and resulting in different cost basis for regular tax than for AMT. The cost basis of these shares for AMT is higher (by the tax preference amount previously reported in 2012) and the capital gain lower by the same amount. Shouldn't Sched P 540 automatically pick up both AMT adjustments (going in opposite directions) in 2013. It picks up the $ 77k add tax preference item but not the <$ 76k> cap gain adjustment. Seems like this form should automatically pick up both - as the data is in the Proseries from Cap Gain Wks and Emp Stock Wks. Thanks for your comments."


1 answer:

"Wanted to comment that for 2013 you probably should have something in Form 6521 AMT Form Line 17 Disposition of property (difference between AMT and Reg Tax Gain/Loss) for the ISO exercised in 2012 but sold in 2013. It might be a negative # to reduce AMT Taxable Income since the AMT for the shares exercised in 2012 was increasing AMT income. That is my understanding."

And another question, which was never answered:


"Should this also show up on line 9 of Sched P (540)? Instructions for 6251 says to enter for "property (that) may have a different adjusted basis for the AMT". Instructions for Sched P (540) says to enter for "income producing property that has a different basis for AMT than for regular tax"


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