### Question
Can you define what alternative tax net operating loss deduction means?


### Answer
**Alternative tax net operating loss deduction** is defined as the following in *26 U.S.C. § 56*:

> the net operating loss deduction allowable for the taxable year under section 172, except that—


(A) the amount of such deduction shall not exceed the sum of—


(i) the lesser of—


(I) the amount of such deduction attributable to net operating losses (other than the deduction attributable to carryovers described in clause (ii)(I)), or


(II) 90 percent of alternative minimum taxable income determined without regard to such deduction, plus


  

(ii) the lesser of—


(I) the amount of such deduction attributable to the sum of carrybacks of net operating losses for taxable years ending during 2001 or 2002 and carryforwards of net operating losses to taxable years ending during 2001 and 2002, or


(II) alternative minimum taxable income determined without regard to such deduction reduced by the amount determined under clause (i), and


  

(B) in determining the amount of such deduction—


(i) the net operating loss (within the meaning of section 172(c)) for any loss year shall be adjusted as provided in paragraph (2), and


(ii) appropriate adjustments in the application of section 172(b)(2) shall be made to take into account the limitation of subparagraph (A)

#### Citation:
  - *26 U.S.C. § 56*
  - Heading: **Subtitle A-Income Taxes > CHAPTER 1-NORMAL TAXES AND SURTAXES > Subchapter A-Determination of Tax Liability > PART VI-ALTERNATIVE MINIMUM TAX**

