26 U.S.C. § 68 : US Code - Section 68: Overall limitation on itemized deductions

Search 26 U.S.C. § 68 : US Code - Section 68: Overall limitation on itemized deductions

(a) General rule
In the case of an individual whose adjusted gross income exceeds
the applicable amount, the amount of the itemized deductions
otherwise allowable for the taxable year shall be reduced by the
lesser of -
(1) 3 percent of the excess of adjusted gross income over the
applicable amount, or
(2) 80 percent of the amount of the itemized deductions
otherwise allowable for such taxable year.
(b) Applicable amount
(1) In general
For purposes of this section, the term "applicable amount"
means $100,000 ($50,000 in the case of a separate return by a
married individual within the meaning of section 7703).
(2) Inflation adjustments
In the case of any taxable year beginning in a calendar year
after 1991, each dollar amount contained in paragraph (1) shall
be increased by an amount equal to -
(A) such dollar amount, multiplied by
(B) the cost-of-living adjustment determined under section
1(f)(3) for the calendar year in which the taxable year begins,
by substituting "calendar year 1990" for "calendar year 1992"
in subparagraph (B) thereof.
(c) Exception for certain itemized deductions
For purposes of this section, the term "itemized deductions" does
not include -
(1) the deduction under section 213 (relating to medical, etc.
expenses),
(2) any deduction for investment interest (as defined in
section 163(d)), and
(3) the deduction under section 165(a) for casualty or theft
losses described in paragraph (2) or (3) of section 165(c) or for
losses described in section 165(d).
(d) Coordination with other limitations
This section shall be applied after the application of any other
limitation on the allowance of any itemized deduction.
(e) Exception for estates and trusts
This section shall not apply to any estate or trust.
(f) Phaseout of limitation
(1) In general
In the case of taxable years beginning after December 31, 2005,
and before January 1, 2010, the reduction under subsection (a)
shall be equal to the applicable fraction of the amount which
would (but for this subsection) be the amount of such reduction.
(2) Applicable fraction
For purposes of paragraph (1), the applicable fraction shall be
determined in accordance with the following table:
For taxable years beginning 2The applicable
in calendar year - fraction is -
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2006 and 2007 (!2/3)
2008 and 2009 1/3 .
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(g) Termination
This section shall not apply to any taxable year beginning after
December 31, 2009.