The $100 ATNOL from 2010 is subject to the 90% limitation; 90% of the 2011 AMTI is $360.
In addition, A will have an ATNOL carryover of $40 related to the 2010 ATNOL.
Note that the IRS's view in FAA 20144201F of the ATNOL ordering rules affects the amount of ATNOL that can be used in this example.
56(a)(4) allows taxpayers an ATNOL deduction (ATNOLD) when computing their alternative minimum taxable income (AMTI).
The ATNOL attributable to years other than a year in which a WHBAA election was made, limited to 90% of AMTI (90% limitation), plus
The ATNOL attributable to a year in which a WHBAA election was made, limited to AMTI minus the amount from 1 (WHBAA-year ATNOL).
56(d)(1)(B)(ii) has provided that any portion of an ATNOL that cannot be used in a particular year due to the 90% limitation may be carried over to other tax years.
Y will also have an NOL carryforward of $3 million and an ATNOL carryforward of $3 million for 2011.
Z will now have an NOL carryforward of $5 million, a normal (limited to 90% of AMTI) ATNOL carryforward of $2.
When advising a client on making the election, it is important to consider the impact on future-year AMTI and ATNOL carryforwards.
56(d)(1)(A), as amended, AMTI is first offset by any available ATNOLs up to 90% of AMTI, excluding a Sec.