Norman

MEMORANDUM *

Paul Norman seeks an income tax refund of $11,023 that he claims he overpaid for tax year 2001. On cross-motions for summary judgment, the district court ruled in favor of the United States. We affirm.

In February 2000, Norman acquired 85,-398 shares of stock by exercising incentive stock options (“ISOs”) granted to him by his employer, Network Appliance, Inc. Although Norman’s ISO discount exceeded $4.5 million, by holding the shares rather than cashing in he avoided realizing any income on the transaction for regular tax purposes in 2000. See I.R.C. § 421(a)(1). For purposes of the Alternative Minimum Tax (“AMT”), however, the discount was taxable income, and he paid AMT in 2000 as a result. See I.R.C. §§ 56(b)(3), 83(a). Moreover, the investment strategy left him exposed to market risk. Not long after he acquired the shares, the dot-com bubble burst and the stock price plummeted. By the time Norman sold his shares in 2001, they had lost three-quarters of their value from the acquisition date. For regular income tax purposes, Norman still realized a capital gain of approximately $1 million. But for AMT purposes, he realized a capital loss exceeding $3.5…