How is net sales calculated?

How is tax calculated for a stock option sales that qualifies for long term capital gain (LTCG) and had caused AMT tax in year prior?

• I work in a tech company that went IPO in 2012.  My ISO option strike price is $1.00 (dollar amounts are approximated). I did a cash exercise on 1,000 vested shares and held all shares when the price was $10.00 in 2012.  I had to pay AMT for the spread ($10 - $1) in my tax return (a surprise to me when I paid taxes for year 2012). In 2013, I sold the 1,000 share at $30. My exercise/sale satisfied the long term capital gain tax rules (i.e. sale occurred two years after grant AND one year after exercise). My question is how much tax do I owe?  Does LTCG apply to $30 - $1?  If that's the case, I would be double paying taxes (LTCG and AMT in 2012) on a portion of the sale.  I feel I am missing something here.

• Answer:

  The only part you are missing in your equation is the AMT credit.  The AMT you paid on the exercise of the options created an AMT credit which can be carried forward and used to reduce tax in future years when your regular tax exceeds your AMT.  Assuming you don't have other significant AMT preference items in the year you recognize the capital gain, then you will likely be able to offset taxes by the AMT credit that you carried forward.