tax benefit rule

Definition of "tax benefit rule"
  1. A regulation in taxation that mandates the inclusion of recovered amounts initially used as deductions in prior tax years into the gross income of a subsequent year, up to the originally deducted amount
How to use "tax benefit rule" in a sentence
  1. Under the tax benefit rule, the recovery of previously deducted losses must be reported as gross income in the tax year it is received.
  2. The tax benefit rule ensures that refunded amounts used for tax deductions in the past are included in the current year's gross income.
  3. When the company recovered some of its bad debt, the tax benefit rule required it to include this recovery in its taxable income for that year.

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