-3-
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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