Jonathan N. and Kimberly A. Palahnuk - Page 3

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          between the 2001 regular tax capital gain and 2001 alternative              
          minimum tax (AMT) capital loss that were attributable to the sale           
          of stock purchased through the exercise of an incentive stock               
          option within the meaning of section 422(b) (ISO).2  We hold that           
          petitioners’ 2001 AMTI is calculated by adjusting their 2001                
          taxable income by the difference between the regular tax capital            
          loss included in the computation of their 2001 taxable income and           
          the $3,000 AMT capital loss that is allowed for 2001 under                  
          section 1211(b).                                                            
                                     Background                                       
               All facts were stipulated or contained in the exhibits                 
          submitted therewith.  We find the facts accordingly.  Petitioners           
          are husband and wife, and they filed a joint 2001 Form 1040, U.S.           
          Individual Income Tax Return (2001 return).  They resided in                
          Hauppauge, New York, when their petition was filed.                         
               During 2000 and 2001, Jonathan N. Palahnuk (petitioner) was            
          employed by Metromedia Fiber Network, Inc. (Metromedia).  On                
          February 23, 1998, he and Metromedia entered into an agreement              
          (petitioner’s ISO) that allowed him to purchase shares of                   
          Metromedia class A common stock at a set price.  Petitioner’s ISO           
          qualified as an ISO under section 422(b).                                   


               2 We consider petitioners to have conceded any allegation of           
          error asserted in their petition that they did not adequately               
          pursue in their posttrial brief.  See Harbor Cove Marina Partners           
          Pship. v. Commissioner, 123 T.C. 64, 66 (2004); Davis v.                    
          Commissioner, 119 T.C. 1 n.1 (2002).                                        




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