Prior-year AMT credit

[CAowner]

What is the name of your state? CA

In 2001, I paid AMT tax to the state of CA because I exercized incentive stock options. The next year, I sold the shares for less than what the market price was when I exersized them. I therefore had a credit for prior-year AMT. I have been using this credit up over the last several years. I still have $7,000 in credit.

I plan to move to another state this year. It seems that I will have to abandon this $7,000 when I leave the state since the only way to get the money back is to apply it to taxes owed to CA.

Is this correct? It does not seem fair that I lose this money I "overpaid" for taxes. Anything I am missing here?

Thanks.

 

[LdiJ]

What is the name of your state? CA

In 2001, I paid AMT tax to the state of CA because I exercized incentive stock options. The next year, I sold the shares for less than what the market price was when I exersized them. I therefore had a credit for prior-year AMT. I have been using this credit up over the last several years. I still have $7,000 in credit.

I plan to move to another state this year. It seems that I will have to abandon this $7,000 when I leave the state since the only way to get the money back is to apply it to taxes owed to CA.

Is this correct? It does not seem fair that I lose this money I "overpaid" for taxes. Anything I am missing here?

Thanks.

Are you talking about the federal AMT credit? Or does CA have an AMT?

If you are talking about a federal AMT credit then you need to be having a discussion with a local tax professional, because you may need to amend some of your past federal returns.

If its a CA AMT credit then most likely you are correct. However it would be best clarified by a local professional.

 

[CAowner]

I have both a Fed AMT credit and a CA AMT credit. It is the CA credit that I am concerned about losing if I move to another state. It just does not seem reasonable that if I overpaid AMT, that I should never be able to get it back just because I move out of state. (Then again, it seemed crazy to me that they should be able to eke it out back to me over years and years rather than giving me the money back the year after they realized that it was overpaid!)

 

[LdiJ]

I have both a Fed AMT credit and a CA AMT credit. It is the CA credit that I am concerned about losing if I move to another state. It just does not seem reasonable that if I overpaid AMT, that I should never be able to get it back just because I move out of state. (Then again, it seemed crazy to me that they should be able to eke it out back to me over years and years rather than giving me the money back the year after they realized that it was overpaid!)

Get a consult with a local tax professional....

 

[Snipes5]

The AMT credit isn't for "overpaid" AMT. It's for the year or years after a year in which you owed AMT, that you meet the requirements for having the AMT credited against regular tax. If you do not meet the requirements, you do not get the credit.

Snipes