The set of tags usable in the ALT text is basically the set of tags that are for character formatting, or those tags that generate objects that appear inline with text. Tags that cause paragraph breaks or are for paragraph formatting are not allowed.
The set of valid tags is:
SUP, SUB
BIG, SMALL, FONT, B, CITE, CODE, DFN, EM, I, KBD, SAMP, STRIKE, STRONG, TT, U, VAR, BLINK, MARQUEE
BR, IMG, A, OPTION, MAP, SELECT, INPUT, TEXTAREA, AREA, OBJECT, EMBED, APPLET