State Farm Mutual Automobile Insurance Company and Subsidiaries - Page 19




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          of section 1503(c) is to direct that items of income and                    
          deduction relevant to operating loss be determined on a subgroup            
          basis, it follows that this framework should be maintained not              
          only up to (as in petitioner’s computations) but through (as in             
          respondent’s computations) calculation of the book income                   
          adjustment in order to arrive at separate ATNOL figures that                
          parallel the separate loss amounts derived under the regular tax            
          system.                                                                     
               The principal difficulty with this approach, however, is               
          that it proposes to override the explicit language of the book              
          income adjustment regulations in absence of any textual                     
          expression of preemption.  While legislative history indicates              
          that the loss limits of section 1503(c) are to apply for AMT                
          purposes, no methodology for doing so was directly specified or             
          mandated.  Use by Congress of “parallel” in this context is not a           
          compelling substitute for express rules.                                    
               As previously indicated, the life-nonlife consolidated                 
          return regulations contain several provisions addressing the                
          interaction between those rules in section 1.1502-47, Income Tax            
          Regs., and other consolidated return regulations promulgated                
          under section 1502.  Secs. 1.1502-47(a)(4), (q), (r), Income Tax            
          Regs.  The life-nonlife sections are expressly declared to                  
          preempt inconsistent rules in sections 1.1502-1 through 1.1502-             
          80, Income Tax Regs.  Sec. 1.1502-47(q), Income Tax Regs.  In               






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