Tax
How are ISOs taxed?
Quick Answer
ISOs trigger no regular tax at exercise, but the bargain element (FMV minus strike price) is an AMT preference item that can create a large alternative minimum tax bill. Qualifying dispositions get full long-term capital gain treatment.
Warren Team
Updated April 26, 2026
35
Warren Team
Updated April 26, 2026
35
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The information provided is for educational purposes only and should not be considered as personalized financial advice. Warren is a registered investment advisor. Past performance does not guarantee future results. Please consult with a qualified financial advisor before making investment decisions.
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