26 U.S.C. § 68
Section 68 · Overall limitation on itemized deductions
Current version, with additions and removals from the August 10, 1993 version.
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.
(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.
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 losses described in subsection (c)(3) or (d) of section 165.
This section shall be applied after the application of any other limitation on the allowance of any itemized deduction.
This section shall not apply to any estate or trust.
In the case of an individual, the amount of the itemized deductions otherwise allowable for the taxable year (determined without regard to this section) shall be reduced by 2⁄37 of the lesser of—
such amount of itemized deductions, or
so much of the taxable income of the taxpayer for the taxable year (determined without regard to this section and increased by such amount of itemized deductions) as exceeds the dollar amount at which the 37 percent rate bracket under section 1 begins with respect to the taxpayer.
This section shall be applied after the application of any other limitation on the allowance of any itemized deduction.