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recomputation of taxable income, leading to a new tax base or an
alternative minimum taxable income. Sec. 55(b)(2). In making
the recomputation, and as relevant herein, certain (but not all)
itemized deductions are not allowed, nor is the personal
exemption. In particular, section 56(b)(1)(A)(ii) states that no
itemized deduction for State and local taxes shall be allowed in
computing alternative minimum taxable income. Further, section
56(b)(1)(E) states that no personal exemptions shall be allowed
in computing alternative minimum taxable income. Finally,
section 56(b)(1)(F) states that section 68 (overall limitation on
itemized deductions) does not apply, therefore decreasing taxable
income by the amount of the section 68 reduction to itemized
deductions.
Petitioners do not dispute the computation of the AMT as
determined by respondent. Petitioners nevertheless contend that
the AMT is confusing and complex, and they are unclear as to why
they are liable for the AMT, which effectively deprives them of
the benefit of some itemized deductions. Petitioners also make
reference to recent proposals by Congress to repeal or modify the
AMT and criticism of the AMT by the National Taxpayer Advocate.
Congress established the alternative minimum taxable income
as a broad base of income in order to tax taxpayers more closely
on their economic income, intending for all taxpayers to pay
their fair share of the overall Federal income tax burden. Allen
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