Charles C. Allen, III and Barbara N. Allen, et al. - Page 20




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          not to apply the plain meaning of section 55 and to adopt the de              
          novo computation of AMTI advanced by petitioners.  Respondent                 
          asserts that the Commissioner has “generally” set forth in his                
          rulings the rationale that the AMT regime is “separate from but               
          parallel to” the regular tax regime.  Respondent observes that                
          the phrase “separate from but parallel to” does not appear in the             
          explanation section of any of the committee reports underlying                
          the Tax Reform Act of 1986 (1986 Act), Pub. L. 99-514, 100 Stat.              
          2085, but that it does appear twice in the “present law” sections             
          of the conference report.  The conferees used the phrase to                   
          explain the pre-1986 treatment of the carryover of AMT net                    
          operating losses (NOLs) and AMT foreign tax credits (FTCs).  The              
          conferees stated that the present law applicable to individuals               
          applied the AMT provisions on NOLs and FTCs in the following                  
          manner:                                                                       
          Present Law                                                                   
                    NOLs are allowed against alternative minimum                        
               taxable income.  For years after 1982, minimum tax NOLs                  
               are reduced by the items of tax preference.  Minimum                     
               tax NOLs are carried over under a system separate from                   
               but parallel to that applying for regular tax purposes.                  
               [H. Conf. Rept. 99-841 (Vol. II), at II-262 (1986),                      
               1986-3 C.B. (Vol. 4) 250, 262.]                                          
          Present Law                                                                   
                    Foreign tax credits are allowed against the                         
               minimum tax, under limits similar to those applying                      
               under the regular tax.  Credits that cannot be used in                   
               the current taxable year because of these limits are                     
               carried over under a system separate from but parallel                   
               to that applying for regular tax purposes.  [H. Conf.                    





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