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Petitioner reads the flush language following section
55(b)(2)(B) to mean that no adjustments provided by section 56
may be made to his taxable income to determine AMTI. The flush
language states that if a taxpayer is subject to the regular tax,
he is subject to the AMT, and if the regular tax is determined by
reference to an amount other than taxable income, such amount
shall be treated as taxable income for AMT purposes. Petitioner
argues that the flush language means that the AMT tax rate can
only be applied to his regular taxable income. Petitioner
misunderstands the operation of the AMT. It is a tax not on
taxable income but on "alternative minimum taxable income" in
excess of the exemption amount. Sec. 55(b)(1); Ellison v.
Commissioner, T.C. Memo. 1995-427 (AMTI of individuals includes
taxable income plus State and local taxes, personal exemptions,
and miscellaneous itemized deductions). And to determine AMTI
the statute requires the taxpayer to make adjustments to taxable
income to compute alternative minimum taxable income. Sec.
55(b)(2)(A) and (B); Holly v. Commissioner, T.C. Memo. 1998-55
(AMTI included taxable income plus personal exemption,
miscellaneous deductions, and State taxes); Ellison v.
Commissioner, supra.
Petitioner's taxable income for 1999 was $8,134.05, the
amount reported on line 39 of Form 1040. As relevant herein, the
adjustments required by section 55(b)(2) as provided in section
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Last modified: May 25, 2011