Robert J. Merlo - Page 2

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               result, P argues that he may use his capital losses                    
               realized in 2001 to reduce his alternative minimum                     
               taxable income in 2000.                                                
                    Held:  The capital loss limitations of I.R.C.                     
               secs. 1211 and 1212 apply for purposes of calculating                  
               alternative minimum taxable income.                                    
                    Held, further: P’s capital losses realized in 2001                
               do not create an ATNOL that can be carried back to                     
               reduce his alternative minimum taxable income in 2000.                 


               Don Paul Badgley, Brian G. Isaacson, and Duncan C. Turner,             
          for petitioner.                                                             
               Julie L. Payne and Kirk M. Paxson, for respondent.                     


                                       OPINION                                        

               HAINES, Judge:  Respondent determined deficiencies in                  
          petitioner’s Federal income taxes of $4,833 and $169,510 for the            
          years 1999 and 2000, respectively.  After concessions,1 the                 
          issues for decision are:  (1) Whether the capital loss                      
          limitations of sections 1211 and 1212 apply to the calculation of           
          alternative minimum taxable income (AMTI); and (2) whether                  







               1  Petitioner concedes respondent’s disallowance of a loss             
          of $21,871 claimed on Schedule E, Supplemental Income and Loss,             
          in 1999 and respondent’s allowance of additional itemized                   
          deductions of $6,797 in 1999.                                               




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