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unused losses may only be carried forward to subsequent tax
years, not back. See sec. 1212(b).
Starting on November 30, 1999, and ending May 1, 2001,
petitioner exercised Veritas stock options and recognized large
amounts of ordinary income for AMT purposes. However, market
values fell, and petitioner sold, over a period extending from
February 28, 2000, through December 27, 2002, all of the Veritas
stock he had acquired by exercising the ISOs. Petitioner sold
most of the shares at prices below FMV at the date of exercise.
As a result, petitioner recognized large AMT capital losses with
minimal AMT capital gains.11 Petitioner contends that the
capital loss limitations of sections 1211(b) and 1212(b) do not
apply to AMT capital losses for purposes of calculating AMTI.
In general, all the Code provisions that apply in computing
regular taxable income also apply when determining a taxpayer’s
AMTI, except as otherwise provided by statute, regulation, or
other publication issued by the Commissioner. Loomis v.
Commissioner, T.C. Memo. 1997-381; sec. 1.55-1(a), Income Tax
Regs. Section 55 is unambiguous. The computation of AMTI
requires a taxpayer to first compute his regular taxable income
and then adjust that amount to reflect the items described in
11 To avoid confusion between petitioner’s capital losses,
the Court refers to his capital loss for regular tax purposes as
his “regular capital loss” and refers to his capital loss for AMT
purposes as his “AMT capital loss”.
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