If I paid AMT in 2015 and couldn't deduct my state income taxes, why is my refund from 2015 taxable in 2016?

[Critter]

This is a bit hard to understand but technically  you did deduct the state tax on the return ... and then you were subject to AMT in addition to the regular tax computed ... and sadly that is just the way the rules work.  You may be able to recapture the AMT paid in future years so follow the program interview for this subject.