tax preference item

Tax preference item

Items that must be included when calculating the alternative minimum tax.

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.

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.

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This increase is no-treated as an alternative minimum tax preference item.

Bipartisan Budget Act contains tax provisions: Tax relief for victims of California wildfires, extension of many lapsed temporary incentives, and a new short-form return for seniors are among the act's revenue provisions

Because tax-exempt interest from private-activity municipal bonds is a tax preference item for purposes of the AMT.

Under the Hood: Planning Opportunities on a Client's 1040, Pt. 1: Income

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.

Investments

interest is the third largest corporate tax preference item. (67) In

Corporate tax reform: listening to corporate America

Interest on certain categories of private purpose bonds is tax-exempt, although tax-exempt interest on some private activity bonds is a tax preference item for both the individual and corporate alternative minimum tax (see Q 1124, Q 1440).

Municipal bonds

Under the AMT, however, ISOs are treated as a tax preference item, and thus the bargain element of the exercise of each stock is included in the AMT base.

To praise the AMT or to bury it

[section] 1202 is considered a tax preference item under the alternative minimum tax (AMT).

The fact and the fantasy of I.R.C. [section] 1202: an illustrative overview and analysis

* 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.

And now the detail: a closer look at California's Partial Tax Conformity

The appreciation element in a gift of appreciated securities is a tax preference item for purposes of the alternative minimum tax period.

Eleventh-hour tax strategies

However, with ATRA's retroactive extension of the 100% gain exclusion and the inapplicability of any tax preference item for AMT purposes, Sec.

Sec. 1202: small business stock capital gains exclusion

The court rejected that argument, stating Groetzinger considered only whether a gambling activity was a trade or business for the purpose of treating a gambling loss as a tax preference item for the alternative minimum tax.

Wagering losses not deductible, gambling business expenses deductible

The percentage depletion creates a tax preference item equal to $6,000: the excess of the depletion deduction over the adjusted basis of the property.