tax preference item

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Tax preference item

Items that must be included when calculating the alternative minimum tax.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

Tax Preference Item

Income or other event that is excluded when calculating one's ordinary tax liability but is included when calculating one's liability for the alternative minimum tax. That is, a tax preference item is an item that would be tax deductible under normal circumstances but is not for purposes of the alternative minimum tax. Examples include depreciation and some interest on municipal bonds.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

tax preference item

An item that can be legally omitted in order to reduce taxable income when calculating an individual's tax liability by ordinary means. However, the item must be included when calculating the individual's alternative minimum tax. For example, interest paid by certain municipal bonds that is ordinarily omitted in calculating taxable income must be included when calculating the alternative minimum tax.
Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.
References in periodicals archive ?
The device is a physician's preference item, meaning it will be sold directly to surgeons instead of going through a process that involves hospital purchasing committees.
Another thing to check: whether making a prepayment, which is considered a preference item for calculation of the Alternative Minimum Tax, will subject your client to the AMT.
In terms of HRM practices, the descriptive statistics show the hiring and promoting preference item mean is 3.77, and the compensation preference mean is 3.14.
Our physician preference item program addresses significant health system pain points and now spans orthopedics, interventional cardiology and wound management."
A portion of the interest on specified private activity bonds issued after December 31, 2010, may be a tax preference item subject to the alternative minimum tax.
Items selected over 80% on each preference assessment were considered high preference items. If the participant did not choose one stimuli at least 80% of the time in one of the preference assessment conditions, the most frequently selected item in that assessment condition was chosen as the high preference item.
As shown in Figure 2, the high preference item was associated with a higher percentage of task engagement (M = 55.1%) than the low preference item (M = 3.2%) and the control (M = 2.2%).
* Charitable contributions of appreciated property no longer will result in an alternative minimum tax preference item for the difference between market value and the taxpayer's basis.
If passed, it would also remove depreciation as an Alternative Minimum Tax (AMT) preference item so that a company would not suffer a tax penalty if it claimed accelerated depreciation.
Both Oldfield (1971) and Briggs & Nebes (1975) include a monocular preference item in their inventories.
Because tax-exempt interest from private-activity municipal bonds is a tax preference item for purposes of the AMT.