Paul J. Pekar - Page 1

                                   113 T.C. No. 12                                    

                               UNITED STATES TAX COURT                                

                            PAUL J. PEKAR, Petitioner v.                              
                    COMMISSIONER OF INTERNAL REVENUE, Respondent                      

               Docket No. 15289-97.                Filed September 1, 1999.           

                    P, a U.S. citizen, resided in Germany and the                     
               United Kingdom during his 1995 tax year.  He paid                      
               resident income tax to the foreign countries in an                     
               amount exceeding his reported U.S. income tax                          
               liability.  P claimed a foreign tax credit that reduced                
               his U.S. income tax to zero.  P did not compute or                     
               report liability for the alternative minimum tax (AMT)                 
               under sec. 55, I.R.C., or the foreign tax credit                       
               limitations under sec. 59, I.R.C.  P claimed that the                  
               sec. 59, I.R.C., limit on foreign tax credits violated                 
               the double taxation prohibitions of the U.S. income tax                
               treaties with Germany and the United Kingdom.                          
                    Held:  The U.S.-Germany treaty and the U.S.-United                
               Kingdom treaty interpreted--P is not entitled to relief                
               from the AMT under either treaty.  Held, further, the                  
               U.S.-Germany treaty recognizes and does not prohibit                   
               the sec. 59, I.R.C., limit as double taxation.  Held,                  
               further, even if the U.S.-United Kingdom treaty                        
               conflicts with sec. 59, I.R.C., because of the                         
               established last-in-time rule, the sec. 59, I.R.C.,                    

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